Spending Diet Challenge: Day #0

Tomorrow,  I start my debt diet. I am going to diet for 30 days and see

Karon Powell wrote a piece recently on Spring Debt Diets.....

This inspired me to do something similar and go on a spending diet. A spending diet is exactly what you think when you hear the term. It's a diet from spending.

What is my diet plan?

1. I waste a lot of money on things that have absolutely nothing to do with me. I'm a very giving/caring person and everyone knows it. As much as I feel the need to help others in their time of need, times are tough for everyone - me included. The first step in my spending diet is to - close the Bank of Rikki.
2. I use to be really good about cooking meals at home and taking leftovers to work the next day, but I got lazy. Second, I am going to cook meals at least 4 days a week for dinner and lunch the next day.
3. Another thing I use to do consistently was take public transportation. There are 3 bus stops within close walking distance from my apartment. Currently, I drive to the metro and ride the metro to work. Metro parking is $4.25 a day (I believe). That's a lot of money for being lazy. When I drive I pay for parking, metro, and gas to and from the station. If I take the bus, I pay for the bus and metro only. Next, I am not going to drive to the metro.
4. I like to think I'm a pretty conscious grocery shopper, but I don't use cupouns. I have subscribed to cupoun websites but don't use them. I am going to start using cupouns when grocery shopping and go back to shopping at International food markets - usually cheaper fresh fruits and veggies.
5. I have a huge sweet tooth. I love candy! Unfortunately, I am not as young as I use to be and can't eat the same things I once did. So, I am going to cut out junk food from my diet. My wallet and stomach will thank me later.

These are the first 5 things I am going to work on to begin with and as I am able to cut my spending by these methods, I plan to look at my budget again and see where I can cut back more.

The Spending Diet Challenege starts TOMORROW! The challenege offically starts tomorrow, May 8, 2012.

Join me in my spending diet. Challenge yourself to find ways to cut back on your spending and let us know how you are doing by tweeting your progress/tips/motivation/challenges to @peoplesfinance, use the hash tag #SpendingDiet. Let's get our finances in order and challenge ourselves to cut back and cut out.

"A journey of a thousand miles begins with a single step."

--  Confucius

 

Behind the Debt Eightball

Personal Finance 4 The People is pleased to team with others who are able to share their expertise in various areas. We hope to combine our efforts to bring a greater financial effort inorder to help you reach YOUR Financial Independence. Today's guest post comes to us from the Karon Powell.

Have you ever opened the mailbox only to find a stack of junk mail and an even bigger stack of bills?  Have you ever felt as if the more money you make the more behind you are?  Are you focusing on paying one large bill and ignoring the small ones that keep growing every month?  If you are then maybe it is time to take a look at the debt hole you are in and start digging your way out.  I know, right now, you are saying good thought but how do I do that? Here are five easy steps to help you get started.

1. Look at the bills

The first and most important step is to open the mail and face the bill monster that’s bearing down on you. Why?  If you are facing a money shortage, like most people in this economy, knowing what bills and due or overdue will benefit you immediately.

  2.  Prioritize 

Once you have opened the envelopes, do not get overwhelmed.  Take a deep breath and sort those bills into piles such as, urgent, longest overdue, small amounts, etc. The most urgent bills should be ones that focus on life necessities such as shelter and utilities. Take care of the urgent matters first.  I get the feeling your next question is going to be: “What happens if there is no money after I’ve paid the necessities?”  Well, we move on to steps three through five.    

3. Cut Expenses  

There are some expenses that disguise themselves as necessities but are really just a drain on your already overstretched budget.  These are items that can and should be eliminated, at least until the past due bills are caught up.  One of these disguised necessities is the cable/satellite bill.  It is time to negotiate, negotiate, negotiate! Call the service provider and get a lower rate. If that fails eliminate that service and get something cheaper or free.  For Television service consider investing in a streaming service like Netflix or Hulu. If you are not a television watcher eliminate the expense altogether and keep connected by using your internet to watch local news to remain informed and in touch.

 4.Consolidate

Some bills can be consolidated or put together.  For instance, that cable satellite bill may be cheaper if it is bundled with internet.  Be prepared to examine the costs carefully and make sure that if it is a limited time offer that you renegotiate before the expiration date.

5.Get Help 

This is probably the hardest step. Getting help means talking to someone about the situation you are in without getting defensive.  It means setting aside pride and moving toward being debt free.  For those in the D.C./Maryland/Virginia area there are a lot of resources available.

Let us take a step back and focus on one of the bills that tend to get out of control fairly quickly, utilities.  You took my advice and opened the mail, paid the mortgage and now there is not enough left to pay the electric bill. What do you do in that instance?  Luckily there are options.  If the bill is less than thirty days overdue call the utility company and ask for an extension on the due date, this may give you the time you need to get another paycheck and pay off the amount due.  Also, contact HEAP or the Home Energy Assistance Program for help paying utility bills.  There are also churches and volunteer organizations that can help with various types of bill payments.

If you need help paying down long overdue bills contact a reputable consumer credit counselor.  These are organizations that can analyze your debt and help negotiate with creditors.  When I say reputable I mean an agency that will not scam you. For help finding a reputable agency contact your local legal aid organization they can usually provide a referral.

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