Rob in Madrid contacted me about the possibility of submitting a guest blog on here. You may remember his name from a post a little while ago where he wanted to pose the question, why do we struggle being forced into frugality. Like I mentioned in that article, he has offered some great insight within the comments on here and I was excited about his offer of a guest blog. He did not disappoint. I hope you enjoy his article as much as I did.
I had asked Tricia if I could bog about I our plans for a CC free holiday but my wife made a comment to me today that brought up an issues that we’ve been fighting and everyone faces. Fighting discouragement, particularly if you’ve been like us and have cycled in and out of debt many times before.
She asked what loan(s) or Credit Cards that we want to pay off this fall and it was problematic for two reasons, one we don’t agree on what approach to take (ie what loan CC to pay off first) and secondly much more importantly it made us focus back on how far we have to go and it gets discouraging when you start to add the numbers up. For us it means we have to crawl out of a deep hole (over 40,000â‚¬ this time). It also reminded us that weâ€™ve been there before, several times. Then you start to wonder what the hell you did wrong, how stupid could you have been. Next thing you know your in a real funk. When you look at the numbers and focus on the payments it seems hopeless. Short of winning the lottery it seems weâ€™ll never crawl out. It’s a feeling Iâ€™m sure many of you have felt. Worse yet is knowing that my wife makes an above average wage yet it never seems to help.
So here’s how I fight the feeling.
First off I divided my money into two piles. One is day to day living expenses and the other is debt. To the debt pile I’ve applied the Debt Snowball principal (google for more info), Iâ€™m aware of how much we owe and what the payments are but Iâ€™m letting it run on autopilot. I don’t want to think about it. This means I can forget it about and concentrate on the second pile. Day to Day living expenses..
Day to Day expenses is something that I have 100% control over. I’ve been tracking our spending off and on for many years so I had a good idea of what we spend per week and month. Problem was up till recent the only concept I had of frugal living was negative so even though I â€œbudgetedâ€ it didnâ€™t make much difference. Discovering the PF blogosphere opened up a whole new world for us. I realized there was a whole lot more than living in debt and struggling to makes ends meet. I realized that we could not only live better on less but we could save money and get out of debt at the same time. Man thatâ€™s better than winning the lottery.
So that’s what I did.
I made being frugal a game. (hat tip to Trent over at thesimpledollar.com) Living frugal doesnâ€™t mean being tight and cheap. Making into a game plays into the competitive side of me.
For example based on previous experience I knew that our weekly spending was around 300â‚¬ or so a week. So applying frugal living ideas I kept w/d 300 a week but changed how I managed it. Instead of just spending and complaining about how fast it went I divide it into 3 piles.
Shopping tithe (70 and 30)
Gas and misc (40 and 60)
So every week it becomes a challenge to see how little I can spend. Can I beat my personal best, can I go this week without any misc spending? Do I really want a Starbucks when I can get a canteen coffee for 40 cents? Brown bagging it means not eating out. Leave 5 mins earlier for class (I’m an English teacher so I bounce around the city all day) and I can drive a bit slower and get that few extra miles out of my tank of gas.
You get the idea, instead of feeling “oh god it’s soo tight” itâ€™s “I can do it this week”. It changes the whole dynamics of how you view and spend money.
Next week – The challenge, can we do a CC free vacation?
– Rob in Madrid
Thanks again Rob for guest posting!