Am I Qualified to Give Advice?

CMC (a reference to CMC Music Factory, I hope) at Twenty-Two Months commented on my car payoff post, saying that she's in the place I was 22 months ago and asked if I had any advice for her. I was going to respond in the comments, but then I realized that I never double check comments AND that this could be a blog topic.

It's funny, I would so NOT have been the person to come to for financial advice two years ago. Like, at all. And there are still areas where I have a lot to learn (does anyone really get how the stock market works. Like, really get it?). But, I guess paying off over $20,000 of debt in 22 months qualifies me to give a little bit of advice. Also, this post is a link-a-palooza, hopefully I chose helpful links! So here are my top five pearls of wisdom.

1. Make a budget: This is definitely the most important thing! I had to figure out where I was spending my money and get a plan for it. One thing I do that works really well for me is to have a budget line as "cushion." This is where any unexpected/forgotten/I don't know what category it fits into expenses go. It's also where I take overages from if I go over in a given category. Sometimes there's extra at the end of the month, which I put toward my debt.

2. Track your spending: A budget is useless if you don't keep track of how much you spend in the different categories. For me, I use a blank journal and keep it all written down by hand. It just works for me, even though I am very computer-savvy...I like my "little black book" as I call it.

3. Take advantage of freebies: I was on a shopping ban, which really made a difference in how much debt I paid off and also in my mentality about buying clothes. I highly recommend a clothes-shopping ban if you have credit card debt. BUT, I did occasionally miss shopping. That's where the freebies came in. Victoria's Secret has free underwear coupons if you can get on their list. I would go in an take my time picking out which color/design I wanted. I would savor that "shopping" experience. I also look for coupons for Sephora and Bath & Body Works, since they have freebies quite often. Yes, you have to have the willpower to not shop in the rest of the mall, but it was nice to have something in mind when I went with friends or to feel like I got to shop. The Freebie Blogger has a lot of junk, but it's a great place to find coupons like the ones I talked about a few days ago. Also, Swagbucks can earn free gift cards to all sorts of places!

4. No payment is too small: If I had a leftover two bucks in one of my budget categories, I would make a car payment. If I sold a book on Amazon for a profit of that same amount, I'd put it toward my car. Those small things really do add up, and it got to where I'd get a rush from making ANY payment on my debt, even a small one.

5. Allow some luxuries: If you go too extreme you'll give up or be miserable. This is not an excuse to keep all your luxuries, but choose what's important for you. I gave up pedicures, clothes shopping, and buying books (library for me). But, I still get my hair cut and colored every other month. I also have a budget for eating/drinking out that is larger than some would allow. But, I planned for it and found ways to make progress while allowing for my luxuries.