What shaped me?
I have had several people tell me that I am a miracle worker when it comes to money, but that is not really so. I just look outside the box and you can too.
Necessity is the mother of invention! Or in my case I was always living paycheck to paycheck being broke but wanting more for my family. That is how it started. I had to look really hard on how I was going to do everything I needed to do like buy groceries, toilet paper, gas, rent, clothing, and somewhere find some money left over to let my kids do fun stuff or have a life.
We had a car payment, house payment, a loan payment, cell phone contract, credit card or I should say credit CARDS debt on top of utilities and groceries!
I moved to Tennessee and my world was turned upside down, divorce bankruptcy, the crazy things that my ex did to my finances and credit were devastating. I discovered Dave Ramsey and I was hooked!
The debt free life is something that I teach my children now. Imagine how much better off I would have been today if I had not lost my house to bankruptcy because of the divorce or imagine how much better off I would have been if I was not tied down to a cell phone contract, loan payment, and a car loan when my income completely dropped in half!
I started thinking. How can I get out of this mess?
I started from the beginning. Where was all my money going? So you make a budget. Then you start looking at the $5-$10 dollar lunches I was buying every day and how quickly that add up! That is like $150 bucks a month! That could pay two of my utility bills!
What about my cell phone bill now that we moved I didn’t get the same service I had in the past so I could make calls in town and on the road but not at my own house (unless I stood just perfectly in my bedroom facing North on a clear day!) So I pulled out my bill and checked how many minutes was I actually using? It was less than 300 a month and I was paying for 750 minutes a month! I called and found out I could not decrease my plan because of the two year contract I was in. But I could pay them a two month fee to get out of the contract and switch to a pay as you go phone with the same service, and pay over half each month. I paid the fee because it was cheaper than keeping them for another six months!
Then the dreaded car payment! Really can you predict the future? Are you sure you will have the same income in the next five years? There are a lot of factors to include in your prediction:
· Will you still have the same income? Accident, injury, death, divorce?
· Will you trust your credit to the government controlling the economy?
· Will your company that has been around for years fail? (Unemployment!)
Then the other no brainers in my opinion are the cost of full coverage insurance if you have a car payment is too high! Do you think that if you add up the chances of you needing a rental car or other expenses outweigh the overall cost of full coverage insurance over five years? They don’t. You can save most of the money you would have paid for full coverage for that rainy day. How much do you think you will actually get for your car with the full coverage if the one in a million chances of it being totaled? Not much! Not enough to pay off your loan in most cases! Then you have the silly argument of oh if I have a used car then I have to worry about it breaking down all the time, where my new car has a warranty that will cover all those repairs. If you lease a vehicle then you are responsible for the tires and the oil changes. Well that is exactly what I have paid into my two vehicles this year, tires and oil changes. I have not paid $400 a month to anyone either. If you save two months’ worth of car payments and full coverage insurance you will have enough to cover any major repair.
The loss of value: Did you know that the new car loses like 60% of its value as soon as you drive it off the lot? Add into that 60% the cost of your interest on your car loan too and you are looking at a HUGE number.
$10,000 dollar car
60% of its value $6000
Are you willing to toss $6000 out the window?
I am not, and most car loans are triple that amount. It is really a no brainer like I said. There used to be a saying that if you cannot pay cash for it you cannot afford it. That is where I am now and that is how I taught my children to live too.
Then I moved down my budget paper and saw that I was spending like $1000 bucks a month to eat! (Going out to eat and groceries) So I had to take a hard look at that.
Here is where I found a way to take a huge dent out of our budget. I surfed the web and found that there were sites like mine that could tell me what coupons to clip and where to find the coupons to get me items for free or close to it. No brainer! I am hooked!
I started buying with coupons. I would get four or five extra items when they were on sale and set them in my pantry. Before long our pantry turned into a stockpile! My daughter would come home from college with her laundry and go shopping in my stockpile. I had everything from free soap and shampoo from Walgreens, to free peanut butter and Chex-Mix from my local grocer. When one of our family members had to move out because of a divorce and start all over I was able to give her a complete stock and supply for her new house! You can donate to your local food bank or church pantry too which makes you feel all warm and fuzzy inside.
It is really not that hard. Then you start watching other sales like office supply stores and they have penny sales for school supplies every year. If you get all of your supplies for a penny you can even have a school supply stockpile!
This saves! Then you learn to watch the clothing store sales and get your family’s entire set of flip-flops for next year for five dollars! Buy your families coats during the months of January and February for the next year and you will save over 75%!
I am hooked on saving! It really physically pains me to pay full price now, and I keep looking outside the box at ways I can save in other aspect s of my life. Like homemade laundry soap, what a SAVER! Seriously you won’t want to pay for that ever again and if so you will have a sale and a coupon!
How about making your own crafts and décor like Martha or even better! Learn when stuff is on sale and knock your Christmas list out for less and get it done before July!
If you want to start saving these are a few easy ways to get started. My blog and other blogs like it will also help you to learn as you go. Really you cannot go wrong if you save fifty cents more this week that is a step in the right direction. Not all of my scores are big, but they add up over time. You can start by only getting the deals with printable coupons and work your way up to getting the Sunday paper and clipping. There is no wrong way to start, but you should look at where your money is going and how you can pay yourself instead of everyone else in the world.