Monday, January 18, 2016

The Debt Jar Update - Finding Hidden Money in Your Budget

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It's only been two weeks and we're already making progress on our jar! I know it won't continue at this rate, but we're taking advantage of the excitement and momentum of the new year to put a little dent in our pennies.
The Debt Jar - How to Find Hidden Money in your Budget

If you're just joining in you can read about the idea behind The Debt Jar here and how much we're trying to pay off.  The first week, we focused on finding hidden money in our budget.

I have to be honest, having a written budget (and sticking to it) has been a struggle for us since we were married.  We have never struggled to pay our bills and have, thankfully, always had leftover money at the end of the month, but something about having everything written out on paper puts an intense amount of strain on the peace in our home.  I've learned that instead of having a specific written budget, it's better for us to keep with general ideas of how much we have for each category and then just check-in regularly on what's left in the budget.  For example, I know how much I can reasonably spend each week at the grocery store and do my best to stay below our limit.

This week we sat down and wrote down all of the payments and bills that we pay each month and compared them to the money we're bringing in each month.  Then, we started looking for ways that we could reduce those payments.

We canceled an account with Sprint for tablets that we bought for the kids 2 years ago.  It was a two-year contract and the kids broke the tablets after the first year.  We have been paying a stupid tax for the past year for data plans on tablets that would have cost more to fix than we spent on Kindle Fire replacements.  Lesson learned!!

Then, my husband called our insurance companies, cell phone provider, and internet provider to see if there were any discounts or cheaper rates available to us.  We cancelled our cable subscription years ago and replaced it with a Roku Streaming Media Player and a Netflix subscription.

My personal contribution to our debt pay-off was more about what I didn't spend.  Right after the holidays, I saw a cairn terrier puppy on our local Humane Society page and I WANTED her.  My husband was more than willing to go get her for me, but (fortunately or unfortunately), she was gone before he could get out to get her.  We took the $100 that we were more than willing to spend on her and put it towards the student loan.  Of course, that also saved us on vet bills, grooming bills, and food bills, so it's probably a good thing that sweet little puppy found a different home.
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All in all, we moved 6 pennies from our "Debt" jar to our "Paid" jar.


HOW CAN YOU FIND HIDDEN MONEY IN YOUR BUDGET?
  1. Write out all your expenses on paper.  A simple google search will yield tons of free templates and forms.  Or, just look at your bank statement and make a list of all your bills.
  2. Compare your expenses to the money you're making.  If you're lucky, there's some extra there that you can immediately start using to pay off your debt.  Even if it's only a few dollars, it will make a difference. 
  3. Call any companies that you make payments to and see if you can negotiate a smaller bill or cheaper plan.  Is there a cheaper internet or cell phone plan that would work for you?  Are they running any promotions? Would a cheaper insurance plan for home or auto meet your needs?
  4. Make temporary cuts in your spending. If you're serious about paying off debt, look for categories in your budget that you can cut (even if only for a few months).  Food and Clothing are usually the easiest categories for this.  I will share next time how we're cutting our food budget for a family of seven.
Are you paying off debt this year?  Leave a comment and share your successes so we can cheer you on!

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