Debt Consolidation

Smart Spending – The Key To Achieve A Debt Free Life

If you are up to your eyeballs in debt, the fantasy of some easy fixes to achieve a debt free life can suck you right in. But, the hard fact about these quick fixes is that they are no magic bullets. In fact, you don’t need a magical wand at all in the first place.

You need a game plan, and once you have that, you will not likely to wind up in trouble ever again. Sometimes, life teaches us many valuable lessons. So, lets take it as an opportunity to take our lessons on smart spending. This is not the time to wallow in despair. This is the time when you just cannot afford to make mistakes. Now is the time to learn how to live on what you earn.

Don’t Hate The B-Word

Budgeting is the key factor of your game plan here. So, get into the habit of budgeting. You have to hang on to the right attitude. The B-word looks scary when you look at it as bigger savings and no fun. But if you look at it as a way of helping you spend less and enjoy more, it can definitely turn the picture around. You can get started in a very simple way.

Keep Track Of All Your Expenditure For 2-4 Weeks

Just keep track of where the money goes for the next couple of weeks. You don’t have to do this forever. You can use your credit card and debit card statements to help you out in this context. Just do it for a month. You will easily be able to find the small holes your hard-earned cash is leaking out from.

The objective here is to look for surprises. You are looking for those “wow” moments – you will be surprised to see how much you have been spending on restaurant meals, on lattes and fast food, on high-speed Internet service, on premium cable-TV channels, or even the change that’s put in the parking meters, and other things like that. These are the small things that we never pay attention to. But, aren’t they making a big difference? Now that you know where the cash is slipping out from, all you have to do is just plug these holes up. This will easily get you another $200-$300 a month that you never thought you had.

Use Your Budget To Develop A Game Plan For Debt Reduction

Now that you have found that extra cash, the next step is to plan your to achieve a debt free life.

- You can start by listing all your bills in decreasing order – first the dues with the highest interest rates and then the ones with lower rates. Start paying the amounts from the top with the extra money that you have while making on-time minimum payments to the others.

- Earn more. In my case, I took on some extra freelance work that really helped me to get just a bit more dough every month. So, this is the time to work overtime. If not, try to get a second (part-time) job.

- If you do not have any way to earn more, you will have no other option but to learn how to spend less. Go in for cash payments only. Make sure to forget your cards at home – in a safe place. If the cards are there in your wallet, you are surely going to use them.

Even if you pay off all your borrowed sums, I think it is a good idea to revisit this budgeting approach at least once a year just to see where you’re going. You will know whether or not you are on the right track.

Once you discover the extra cash that you can save, you can stock it for emergency, retirement fund, or other such things. You will still have some amount left that you can spend with a relaxed mind because you know that you are saving up too.

To make the best use of your money and pay off all your bills at a faster pace, opt for debt consolidation to consolidate your loans into one single loan. It has helped many people achieve a debt free life. Mine is the biggest example, as I erased $129,000 mortgage in less than five years. My friend Lizzy paid off about $46,000 in credit cards in just twelve months. You can also be one of those debt-payoff champions. All you have to do is to follow the smart spending strategies and make the right moves before it is too late.

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Posted in Budgeting, Debt Consolidation, Debt Management | 12 Comments »

12 Responses to “Smart Spending – The Key To Achieve A Debt Free Life”

  1. Gerry Gateley says:

    Basically-yes. What it comes down to is you make proposals to folk’s collectors and test so you can get as substantially written away as doable. If your client declares bankruptcy then the creditor could get all of absolutely nothing so they’ve already an incentive to negotiate. As soon as you file the POA the collectors ought to talk to your account, not the debtor. It is a lucrative business-go for it!

  2. Carmen Edson says:

    Many collectors get greedy and renege on deals and have a go with to squeeze you for a whole lot more. The same happened to me. I complained to our representative and she stuck up of the creditor saying there are trying to get there money. I said hey we had an agreement on an total which We have stuck to with you since the go between along with the harassment was supposed to halt. I am aware what you mean and I wouldn’t deal with this sooty person anymore either.

  3. alisa says:

    Seriously when we plan ourselves for a debt free life we can achieve this target. This article provides a successful tricks of the trade that we can budget our expenses well in advance .Planning is required in a hard copy so that we can remind ourselves.If we could track our expenses in a well maintained diary we can have a look where we are overspending and can cut short the expenses. If our thought process works in this direction we strive to earn more by taking up some part time assignments and try to pay off the pending loans.
    Very thought provoking article.

  4. MARRY says:

    How can a debt free life is to admit that we are in debt. Leaving bills unpaid? Is there any solution to our debt problems?

  5. samaira says:

    That’s a very good article. I think if everyone knows the tips and tricks of smart spending, then it’s easy to live a debt free life. If anybody wants to plan a good strategy of smart spending then there are various workshops organized for the same, which let you learn how you can drastically reduce your expenses and increase your savings.
    I think everyone must go ahead with it, as to live a debt free life is that reality which everyone dreams of but hard to get.

  6. robert says:

    Very good proposal. This article gives the information that how do we plan a system for a debt free life. Basically, if we maintain our system as per planning, the budget will not go out and the month will pass with very good time. We should maintain a list as per the requirements which can track us where we are overspending.

    It is also very funny that we should forget our cards at home. Cards are helpful in emergency situations. So, while going out to market, you should remember what will be your limit and you will try not to excced it. This process will make your budget very effective.

    All of us have to follow the smart spending strategies and make the right debt consolidation.

  7. best student loans says:

    A lower market interest rate should get you interested to refinance your loan. This is especially so if you are tied to a high interest rate.

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  12. [...] Free Life Posted on September 11, 2010 by creativelipi39 If you are up to your eyeballs in debt, the fantasy of some easy fixes to achieve a debt free life can suck you right in. But, the hard [...]

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