subject: Reduce Your Credit Card Debt – Control Spending And Eliminate Debt [print this page] Paying down your family's debt may be your top priority right now, but how do you find extra money to do that? You're already working two or three jobs, so how can you put your hands on some more cash to pay off your credit cards? Your budget seems pretty tight, but there's a little bit of room that you may be overlooking. Your flexible spending is an arbitrary figure, based on past expenditures, so couldn't you take those expenses on your budget and just swipe 10% right off the top?
Begin by taking a look at your existing budget's flexible expense columns. These would be the expenses that you estimate what they will cost each and every month. The most obvious are food, clothing, and gas for your car. You may have others, but let's start with these three.
FOOD - Families spend somewhere in the range of 10% to 13% of their income on food. This is according to both the Department of Agriculture and the Bureau of Labor Statistics. Other studies even indicate that some families spend as much as 20% of their income on food.
You need to figure out what your family spends on groceries every month as a percentage of income. If you are in the 20% range, you've got your work cut out for you. But, you can also see what a nice chunk of change you'll have if you take 10% right off the top of any grocery budget.
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 - Your clothing budget may be another way to find more money to use to pay down your debt. Once more, we take 10% right off the top of your monthly budget and apply that amount to your credit card debt. Spending 10% less for clothing will most likely turn you into a creative shopper. You will definitely want to stay out of the malls or boutiques just to avoid the temptation.
With the economic downturn hurting most families, it's not surprising to see a surge in the consignment and resale shops. Most communities with have at least one resale shop that you can start to visit. There are the well known larger charity organizations, but consignment shops are becoming more popular. Some consignment shops even feature business attire, while others focus primarily on children's clothing. Making routine stops at a consignment shop or any resale shop will be an adventure. There is always something new.
Thrift shops run by a church are still a good place to browse. There have also been a growing number of Moms and Tots play groups that spend just as much time swapping kids clothing as they do playing. If you have teenagers at home you may have a more difficult time convincing them to go with you to the consignment shop. However, for your progressive teenager, there are sites like FreeStyle Clothing Exchange that have the right look, fashion, and attitude to appeal to teenagers. The mission and message is also forward-thinking. They believe that exchanging fashion is the "green" thing to do, which makes it the "cool" thing to do.
GASOLINE - This may be a difficult habit to break if you typically pull into the gas station anytime you want. Driving on a strictly budgeted allowance is difficult, but not impossible. Let's say you fill up your car three times a month and it costs you, just pick a number, $50 every time. If you could reduce your monthly consumption by just $15 a month, that adds up over time and can really impact your debt reduction plan.
A mere $15 each month may seem like a drop in the bucket, but over a year's time it amounts to $180 available to you. Paying that amount on just one credit card makes a difference, especially as the payments are made each month and the interest charged to you keeps dropping and dropping with each payment. This is no chump change!
Cutting back on your driving to save money is a tough decision to make, but it can be done. Consider every time you get into the car whether or not this particular errand can be done another way. Could you walk, take a bus, or ride your bike? If commuting to work takes up a large part of your driving, are there alternatives, at least once or twice a week? Other people you work with may be trying to reduce their gasoline bills, too, and car-pooling may the answer.
One of the most difficult driving habits to break is just going where you've always gone in exactly the same way. The most costly gas burner is driving kids around to their events. Re-evaluating your route during these trips may be necessary. Running children from event to event may need to involve some downtime for one or more child, as you may not be able to deliver them back home before the next event. Bring some books and snacks along in the car because Junior may have to sit with you and wait for Sister.
The flexible expenses you've included in your family budget have at least a 10% cushion that you can easily skim from. Your figures were derived from what you've spent in the past, and you've been over-spending if you can't pay off your debt. That soft-cushion in the flexible expense budget has to go because it simply has not been working so well for you.
Can you really find cash in your flexible expense budget? You sure can! Start by taking 10% off the top of each monthly flexible expense item and add up those amounts. That's how much you can send your creditors each month. And, if you multiply that amount by twelve, just think of reducing your debt by that much money come this time next year. When you start paying off your debt with money you didn't even know you had, your family's financial security is looking great!
Reduce Your Credit Card Debt Control Spending And Eliminate Debt
