Debt and Financial Goals 2013

Our financial situation has improved in spite of global economic crisis. Alberta and Saskatchewan have seen their economies grow and the area where we live is busier than ever. But it hasn't always been this way, and I have a long memory.

In writing this, I do not intend to condescend to anyone else's situation or act like what we have done would work for anyone else. But among my friends I am thought to be frugal, and I have often been asked what we have done to set money aside to pay down bills. Here are a few of the things that have helped us pay off our debt:

1. You must must  know where your money goes every month. Go through your bank statements, credit card statements, everything, and see where you are leaking money. Husband was paying $20 a month in bank fees, on an account that we barely ever use. Cancelling that was a savings of $240/yr, which is groceries for at least two weeks.
• write a list of all your bills. Which ones can be lowered? Netflix instead of cable? Library instead of renting? You might find that some of the free activities in your community also make you feel happier and get you outside more. Put what you save towards paying off debts. 
2. We pay our credit card off every month. 19% interest is INSANITY. If you have credit card debt perhaps you can pay it off with a line of credit with a much lower interest rate. Pay that off ASAP.
• We use a credit card that earns us airmiles. I am not promoting airmiles by any means, but Husband is from Newfoundland and we save them for flights home for us. We are spending the money anyways so we look at the miles as a free bonus. NOTE: you MUST pay off the entire balance every month or your airmiles are costing much more than they are worth!
3. Get on the same page as your spouse. If you are the saver and s/he constantly sneaks through drive-thrus, resentments can grow. At the same time, if s/he doesn't understand what you are working towards or what the goal is, s/he is bound to run off course. Sit down and talk about it.
4. If it is possible to work an extra shift here and there without derailing your home life, put the extra money directly towards debt. Get rid of the debt, build an emergency fund and start saving. Always have these goals in mind.

5. Do I even need to say this one? Stop smoking. Don't drink so much. Skip the junk food, pass on a meal out. Think about your personal vices, what is holding you back health and budget-wise?

I plan to post more on this subject; I look at budgeting as a personal challenge and I actually enjoy scheming new ways to save or find deals. We want to travel as a family and spend our time together rather than working for others. If we can live sensibly and make our money work for us, we will get closer and closer to our long-term goals. Do you have a long-term plan for your money? What are you doing today so that you reach your goals tomorrow?