To save money, a plan is important. That plan has several facets, and each one is customizable to your life. The process is clear, but there are often sacrifices to make. That said, cutting expenses and meeting goals come with bountiful rewards, which are both planned and unplanned.
What is Your Reward?
Imagine a situation where you frequently see sales for Delta flights as you surf the Internet. Each destination, you think to yourself, is perfect for different types of vacations. Maybe one flight would take you to Europe where you could experience rich history, delicious food and meet wonderful people. Perhaps another of those flights would take you to a relaxing beach in a gorgeous tropical location without a care in the world.
A dream vacation is a great example of a reward that makes any sacrifices easy to deal with. Concert tickets to experience a favorite band live or theater tickets to a popular short-run play are other goals to work toward. Always set your reward first. It provides something positive other than a lighter debt load to look forward to.
Determine Goals
Which of your debts gives you the most trouble? Some debt seems easy to handle at first, but when they pile up together, the are suddenly overwhelming. It is nearly impossible to give up a house or car. When it comes to student loans and credit cards, there is really no other recourse than paying the balances down.
The figures may seem huge and permanent, but they can shrink! Go after the smallest amount first. Find sum that is comfortable and tack it onto the minimum monthly payment each month. Rather than putting that extra money back into your regular budget, roll it over to the next smallest bill.
Now, it is understandable that you may not see where that initial extra payment will come from, but it is surprisingly simple. The extra money will come from cutting back on other expenses.
Where Does All the Extra Money Go?
To bring bills down and reward yourself with that luxurious vacation, the money has to come from somewhere. You may struggle with your current salary, but it is likely that you spend on things regularly that are unnecessary. You are not alone — most people do. To effectively cut expenses, prioritize spending and learn how to treat yourself again.
This means cooking meals at home, bringing lunch to work, walking when possible and cutting back on extra monthly expenses. Food alone can save hundreds each year, and it does not mean that you cannot enjoy an occasional restaurant meal. That is treating yourself.
Drop cell phone data plans unless you need it for work, and switch from cable TV to less expensive Internet streaming services. Take it a little further for more savings, and find regular sources of entertainment that cost nothing while treating yourself to a movie once in a while.
Every dollar you cut from spending on unnecessary items and services means less stress from debt. Each dollar also contributes paying for the Delta flights that will take you away on your dream vacation.