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Posts tagged with: debt reduction

How I Reduced My Debt by $10,000 in 6 Months

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By Alan Helman

Chances are incredibly high that, at some point in your life, you will have to deal with debt. Thanks to increasing tuition rates and decreasing summer employment, students are leaving college and university saddled with large amounts of debt. Then add in the costs of starting a family and buying a house and a car and…well, you see the problem. A lot of people who had dreamed of a life as an artist or a designer find themselves having to switch gears in order to handle this debt, and then falling into a depression when they look at the seeming impossibility of becoming debt-free.

When I graduated, the first thing I had to establish was that it wasn’t possible to pay off all my student debt at once, and looking at the full amount due almost gave me a heart attack. I told myself not to freak out; paying off the debt was possible. It would take some creativity on my part, and might require I change my way of living a bit, but the thrill of realizing that I wasn’t so deep in debt was certainly worth the life change.

Build a Budget

After a lot of research, talking to friends and professionals, I found that the best way to reduce (and eventually get rid of) my debt is to set a good budget and follow it. I determined how much money I brought in each month, then figured out what percentage of that absolutely had to go to standing bills like my mortgage, car payments, debt payments, etc. The money that was left over could then be apportioned to my remaining monthly purchases. I started with the most important areas: figuring out an amount to devote to food, an amount for gas (and transit fees, for when I took the train or might need a cab), and an amount for entertainment. I tried to leave myself with extra money in the kitty, because I knew a few things already:

1. Chances were high that I would break my budget in one area or another, especially when just starting out.
2. The extra money could be used to pay down more of my debt.
3. It’s always a good idea to try to accumulate a bit of a savings to safeguard against emergency situations.

There are plenty of online systems that can help create a budget, so I took advantage of that in my planning. The New York Times suggested some great apps such as LevelMoney or Billguard–these systems often come with fees attached, and that money would have to come out of the budget, but it was worth it in the long run. Apps like this provide a valuable service and, for me, were 100 percent worth the money. It might not be the same for you, so make sure you know what you’re getting into before you jump for a service.

Search for Sales

I found one of the best things about the Internet is that it makes looking for deals much easier. I no longer had to scour the newspapers and local flyers for the right coupons or stand in line for the huge sales at stores; everything was online where I could access it easily. Since I’d already budgeted for my Internet bill, it was simple. I discovered coupon apps, which led to some pretty great savings (or refunds and rebates) once I uploaded my receipt to the app. Other coupons could be saved on my iPhone, and then shown to the cashier to be scanned. Though the amount saved on each coupon seemed pretty small, it added up quickly. For beginners, the Toronto Star has a great list of sites and advice from people who are quite successful at utilizing this method.

If I needed a new electronic device or piece of computer hardware, I just made sure I found the best deals online. This simple act saved me hundreds, possibly even thousands of dollars. I was amazed at the plethora of things I could find coupons for on the net.

Increasing Income Creatively

I didn’t have the time or the energy to take on a second job, but this didn’t mean I couldn’t increase the amount of money I was bringing in. This is actually where I found I could draw on that creative side that I’d come to fear was lost forever. Thanks to online eCommerce sites like Shopify, I found I could create an online store of my own to sell my art, design and products bearing them. I was able to set up a shop that held my unique designs, choosing a price that I felt was fair while still competitive.

While I worked to pay the bills, my designs were finally online for millions to discover. With a little bit of effort in my spare time (dealing with the orders, creating product), I found I could actually, at least in part, live my artistic dream — and still pay the bills. I never had to be a starving artist.

If you think the idea sounds like a silly fantasy, like I did at first, you should know something: this is actually how new designers are approaching the market. Cutting out the retail store middleman allowed both for increased profit but also increased creative control, and even beyond that I came to the realization that the online market is much bigger than single retail stores. It’s quite serious; the Wall Street Journal has touted this method as “the new black.” Online sales are always on the rise, so this was the ideal opportunity to live my dream while still keeping a foot in the regular working world.

Very few people will live a life of complete leisure, never worrying about their income. But having a budget didn’t mean I couldn’t have nice things (or, you know, things). It just meant I needed to be a little more creative when it came to choosing how to buy things, and left me to explore other ways to make money. The biggest thing I learned was that it doesn’t actually have to be a huge effort, thanks to the wonders of the Internet and current technology. Six months later, and I’m that much closer to living debt-free. You could be too.


Top 10 Reasons for Divorce

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I’ve always heard that money issues are one of the top reasons for divorce in the US, but when I went looking for statistics about causes for divorce, I had a surprisingly difficult time finding a reputable source to justify this claim.

Sooo, who knows? But, I did find this law office (site here) that provided a Top 10 list of reasons for divorce in America. Don’t know how reputable it is (would have loved to see a Nation-wide survey done by someplace that is not affiliated with making money from divorce….like a Gallop poll or something), but here ya go:

Top 10 Reasons for Divorce in the US  (according to these guys):

10. Boredom

9. Careers

8. Inability to have children

7. Loss of Interest

6. Abuse

5. Lack of communication

4. Addiction Problems

3. Social Networks

2. Cheating

1. MONEY ISSUES

 

So there you have it.

I bring this up because my husband has just come off a 16-day work stint (yes – 16 days in a row with no days off). Right now we are lucky to be in a place financially that money is not a big issue. We have enough to pay all of our bills and put a hefty amount toward debt payments each month. If we really stay nose-to-the-grind, we’ll be debt free in just another 2-3 years! That’s fabulous, right? (especially considering when I started blogging in March 2014 we had almost $150,000 in debt!!!!)

Well, yes. It’s certainly a good thing. We haven’t had an argument about money in a long, long time. We may have disagreements (like, he wants to put more toward savings and I want to put more toward debt), but no actual “fights.”

But you know what we’ve had a couple arguments about lately? Time. I was originally going to title this post “Time versus Money” because those feel like the two options we’re having to select between.

Husband’s business has been crazy busy lately (he owns a small wood flooring business). This is an awesome thing because he could unexpectedly have a solid week off work if a job were to cancel, or there’s subfloor issues that need to be fixed, etc. etc. etc. We can never “count” on the next job so his motto has always been that he must work while there’s work to be had. Things always traditionally slow down around the winter holidays. No one wants someone ripping up their floors and making a mess over Thanksgiving or Christmas, ya know?

So the issue is this:  time or money. What’s more important? I’ve been feeling like a single Mom a lot lately. I do it all: cooking, cleaning, yard work, taking care of the dog, the kids, household chores and errands, etc etc etc. Meanwhile, hubs has been working basically all day, every day. He usually works doing flooring from 7am-4pm, then he might come home for a couple hours, and go back out again in the evening to do bids. Then he comes home and takes time to write up and email out estimates. Plus, the phone calls are incessant. ALL.THE.TIME he gets calls from customers, his employees, the stores he sub-contracts through, etc. It’s endless. So I’ve been feeling a bit neglected and sorry for myself. And when I bring it up, the question is always the same:  Would you rather me work less and make less money???

Phooey.

Knowing that this is not how things will be forever I just grit my teeth and bear it. But it was certainly interesting to see “careers” listed at the #9 reason for divorce. I think this whole time-issue that I bring up could certainly fall under the career category.

Anyway, this is just something I’ve been thinking about as of late and wanted to bring it up.

Between the options of time or money, which would you select and why? I’m sticking to our debt-reduction goals and picking “money” right now, with the knowledge that inevitably we’ll have more time down the road when business slows down a bit. But it still doesn’t make the present very fun!

Like we mentioned above, addiction is one of the leading causes for divorce in the U.S. If you or your spouse is suffering from addiction dont let it destroy your life. Consider visiting the best drug rehab center in Washington state and save your marriage. 


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