by Susanne Myers
Like most families who want to reduce their debt, you probably need to find a source for additional cash. Before you say “We already work three jobs!”, wait! There may be some extra cash already in your pocketbook. Tracking your expenses and making sure that all your bills are getting paid on time is not going to get you more cash. But, if you get out your budget and start swiping 10% off the top of every flexible expense, you may be closer than you think to eventually eliminating your debt.
Your family budget consists of expenses that are fixed and expenses that are flexible. Typically, a family has an estimated expense each month for food, clothing, and gas for the cars. This estimate usually is based on a history of spending. Let’s take a look at what would happen if you chose to steal a little money from each of these expense categories.
FOOD – According to both the Department of Agriculture and the Bureau of Labor Statistics, families spend about 10% to 13% of their income on food. Some other studies even indicate that there are families who spend as much as 20% of their income on food.
Are you currently spending 20% of your income on food? If so, there will be changes that greatly affect your shopping habits. Change, especially when it comes to our beloved eating, is hard. But, when you see the cash you have to pay down your debt, you’ll be happy you made this change.
Just to make things simple, let’s say that you spend $100 a week on food. If you imagine your shopping cart, could you remove just $10 worth of items? If it’s hard to give up your favorite luxuries, imagine the money you’ll have in your pocketbook at the end of five weeks of skimming just $10 off the top of your food budget. How does $50 extra paid toward your debt reduction feel? Now can you remove a few items from your cart?
Paying down your debt with that “extra” $50 begins to really make sense when you consider doing this every month. Those payments rapidly snowball because you’re reducing the interest on your credit cards and paying more and more toward the principle. It just makes good sense.
CLOTHING – A family’s clothing expense depends largely on the age and lifestyle of your family members. If you tend to shop for clothing whenever and where ever you please, skimming 10% off your budget may be a great way to get that extra cash to pay down your debt. Once you learn a few new shopping techniques, you’ll be able to dress the family for less, and may even enjoy the challenge. But, you will need to break your boutique habit immediately.
With so many folks in the same circumstances these days, it’s not surprising that consignment clothing and resale clothing shops are booming. Search your community and you will find new shops opening almost every month, along with the standard resale shops that we all know. If you need professional attire, you’ll find many of the new consignment shops catering to professionals, but don’t stop there. You’ll be pleasantly surprised to find many of the charity-supported shops have expanded.
The old church thrift shops are growing, as well. It also seems as if Mom’s groups are spending more time exchanging clothes at play dates. Some clothing exchange groups are quite extensive, but just getting together with your friends may result in at least a few swapped items. If you have teenagers in your house who love fashion, there are online exchanges that are very upbeat and carry very popular messages. The clothes are fashionable and the message includes recycling fashion as the green thing to do for the planet. Look for sites like FreeStyle Clothing Exchange. It’s very fun and has an excellent mission that your teenager will love to get behind.
GASOLINE – Even if you have become accustomed to filling up the car whenever you want, you can break this habit. A budget that assumes you fill up your car three times a month at, say, $50 each time, allows you to spend $150 a month for gasoline. What if you only allowed yourself $45 three times a month? Would it impact your driving habits that much? That $15 savings each month could start to put a dent in your credit card debt over time.
If you’re thinking that $15 each month doesn’t matter, that is $180 you could save over a year. I’m thinking that at least one of your credit cards could use an extra $180 payment this year. You and your driving habits won’t even miss it!
Now, that 10% skimmed from your gasoline budget may call for a bit of frugal travel. Every time you climb into your car, you will need to ask yourself if there is another option available to you. Can you take public transportation, walk, ride a bike, or car-pool? If parents are driving kids around to events, can you discuss pooling your rides? There are probably people you work with or play with that are looking to cut back on their driving, too.
Planning your driving routes can really help cut down on back-tracking, especially when chauffeuring children around to their events. This is probably one of the most difficult driving habits to re-evaluate. If your children’s activities overlap, rather than run one child home in between, perhaps it’s possible to stay at the event with both children, until the next ballgame, meeting, or school event starts.
Our family budgets no doubt have wiggle-room in the flexible expenses because we base our needs on our past spending habits. But, ask yourself this, “how has that been working for you?” If you’ve got too much credit card debt, then I’d say the answer is that it hasn’t been working very well at all.
It won’t be that hard for you now to find some extra cash to pay on your debt. Simply run down the list of monthly flexible expenses in your family budget and swipe 10% right off the top of each item. Add those dollar amounts and just look at the cash you already have! Multiply that amount by 12 and look at what you have for the year! When you think of what that money means to your family’s financial security, I’m sure you’ll be more than willing to find a way to dig right in!
About the Author:
If you’ve developed some pretty loose
Money Spending Habits which have gotten you into too much credit card debt, perhaps a new way of
Thinking Frugally will be what will save your pocketbook. A little more money to pay on those credit cards will go a long way to finally being financially free!
