One of my biggest prayers is to one day become debt free. Had I only known 15 or 20 years ago what I know now..... If I had only known and diciplined myself, I would have at least opened up an account with compounding interest when I was in my twenties. At least I would be much better off than I am now. I have many more tips but i would like to hear what others have to say.
Use debit cards rather than "credit" cards, (which I think should really be called "liability cards".)
Living below your income level is very good sense. Often we get the most house we can afford, buy cars by the amount of the monthly payment and hinge today's purchases on tomorrow.
Plus read Dave Ramsey's book about reducing debt. It really works. "Total Money Makeover"
Don't give in to the "I wants." Get only what is truly needed.
Pay off that liablity card at the end of each month. In doing so, the air miles or cruise fares really will be free. I have been given $4,500 towards 2 cruise fares by charging everything, and paying it off at the end of each month. Not bad since I've had the card for just under 4 years, which means every other year I get a free cruise for 2.
Yes, f-mattox: Not only do I concur, but I agree whole heartedly; invest aggressively, especially if you are young. If your company matches your deferred compensation, then you take at least as much deferred comp that will kick in the matching contributions from your employer.
Posts: 1371 | Location: Cameron Park, CA | Registered: January 23, 2007
Never ever pay just the minimum on your credit card debts. Set up a plan to pay them off one at a time. Start with the card with the lowest balance or the highest interest and pay anything extra you can afford. Always pay at least twice the minimum..once that card is paid off, do not think you have extra money to blow, take everything you paid on that card and apply it to the next card. Destroy the first card you paid off. If you continue this you can be credit card debt free in a short time.
Learn to say "NO" to your children. When they are 16 they can get part-time jobs to help pay for their extras. They need to know what money is worth.
You really do not need a 51" television. 27" TV still gets the same shows. Just sit closer. Buy responsibly. (apply the above to SUVs, Hummers, Corvettes...)
You don't need a camera (etc) phone. You just need a plain cell phone. Mine is $30 every 4 months. It makes/receives calls. Period.
Think before you buy....shop around....never buy something if it is NOT on sale.
Teach your children at an early age, what it is and how to save. My children ages 4 and 8 both have bank accounts. They know whenever they get money to put half of it in their account. When they are 18 they should have a nice savings. I'm training them in the way they should go and when they are old I pray they will not depart from it.
Originally posted by simphhcc: Teach your children at an early age, what it is and how to save. My children ages 4 and 8 both have bank accounts. They know whenever they get money to put half of it in their account. When they are 18 they should have a nice savings. I'm training them in the way they should go and when they are old I pray they will not depart from it.
Your children will thank you!! My parents did the same for my brother and I when we were growing up, and it definitely taught me the value of saving. I wiped out my childhood savings account recently for a good cause... those monies helped me put a down payment on a house!
I'm waaaay too young to give financial advice (early 20's), but I'm doing well for someone my age and I think it's because my parents taught me NEVER to buy anything I couldn't afford... NEVER use credit cards unless it is an absolute emergency. Pay by cash or check only. Well, I follow their advice in concept: I charge EVERYTHING to my credit cards, but I pay the balances in full every month and still enjoy the "reward point" perks. Those credit card rewards help me pay for my cruises.... and no debt! Thanks mom and dad!
Jillian, that is great!!! That's what I like to hear. That is what I want to hear my boys say some day. I know your parents are very proud of you. Keep it up.
When my son was in college I encouraged him to open a brokerage account for his parttime and summer employment and when he graduated from college and started work, I promoted the 401 where he works and now he is already reaping the dividends of a better retirement when that day comes. He is a regular saver and will be throughout his working career.
I find it interesting that no one has yet mentioned making a budget. To do this you do not need to be ridgid, start with your past bills and classify them as things that had to be paid, (Mortage, Insurance, school bills etc,) and those that were discretionary (like shoes, movies, vacations, eating out, golf, bowling), and those that are variable but necessary, like food and gas. If you have trouble with impulsive buying then deposit everything that is required in the bank from your paycheck for future payment of required and variable (include monthly and biweekly etc. You can also include a stypend for gas) so you know you can write a check to pay it when it comes due.) Add up your required expenses and subtract from your paycheck, the balance is discrentionary, allocate it (assuming you have some) to savings and spending. Put the spending money in cash in your pocket. You are allowed to spend the cash anyway you want, if it runs out you are done spending for that pay peroid.
If your discretinary is Negitive, you are in a lot of trouble, and need to drop expensives like sell your expensive car or refinance the house, or default on your school loans, get a second job, run a yard sale and pay down your loans.
Good luck, You can do it. There are some good web site taht can give you guidance on what is normal expenditure and mioght also identify some things for the budget that you could forget, Like Dr co-pays, or car maintenance and stuff.
CruiseDad, you are so right about the budget. I have to follow a very strict budget that my fiancé created for us so that we could afford to invest our money in our first home. (He has even put me on an allowance of $10/day for anything outside of what he has budgeted for!)He has an elaborate grid that is divided into categories such as those you mentioned, and he even draws up a new grid whenever one of us gets a raise, no matter how small it is. He absolutely LOVES keeping a very close eye on our finances, and I am grateful for his attention to detail. My "don't spend it if I don't have it" attitude has always kept me out of debt, but I never would have been able to buy a house at my age without a partner who actually get satisfaction from living within a strict budget.
[QUOTE]Originally posted by jillianallison: CruiseDad, you are so right about the budget. I have to follow a very strict budget that my fiancé created for us so that we could afford to invest our money in our first home...."
Ah yes a first home. That is one of life's big pleasures. It is a dream of my daughter to buy a home, so very expensive these days. she saves most of her dancing pay with just that in mind for when she leaves the ships.
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