Your Best Advice

My friend Ursula has started a blog called My Twelve Weeks, in which she's been writing about her various goals in twelve week cycles/phases. I like this idea because it gives built in reflection and a chance for a fresh start every three months. Brilliant! And I like her. :)

One of her many ambitious goals is to work on getting out of debt...I've been there, and I know a lot of you have. She wrote her budget this week (Holla! Get it girl!) and is getting on the right track for sure.

I can remember when I was first trying to get out of debt and get my finances in order, I was hungry for tips and tricks and strategies. I read blogs like crazy before I started mine. I got to thinking of the most helpful advice for when I first started out. Here are my top five:

1. STEP AWAY FROM THE CREDIT CARDS! I had a bad habit of paying an ambitious, unplanned amount on my cards right after payday, and then getting to the end of the month, running out of money (I wasn't budgeting or changing my habits) and pulling out the credit card to get by. I would end up undoing most of what I'd paid, and sometimes making the balance even worse than when I started. The only way to get out of credit card debt is to STOP USING THE CARDS. Even if that means a smaller payment at the beginning, make it one you can stick to and put those cards away!

2. TRACK ALL OF YOUR SPENDING. I cannot guess how much I spend in various categories, even now. I sometimes take a few days to update totals and am unpleasantly surprised by how much I manage to spend. For me, it's written in a little black book (forget guys' phone numbers) and divided into categories. It's low-tech, but it works for me.

3. MAKE A BUDGET! I have to have boundaries. Tracking spending isn't useful unless you have limits and boundaries of how much you are allowed to spend. It takes time to get your perfect budget (I still build a cushion into mine every month for unplanned expenses or overages), but you have to create one to get anywhere.

4. YOU DON'T HAVE TO KEEP UP WITH THE JONES'S. This was more implicit advice, but in reading PF blogs, I saw that not everyone is rushing out to buy the latest gadgets or going clothes shopping all the time. Plenty of people limit themselves, and most find they are happier that way. I gave up clothes shopping for a year, until my credit cards were paid off. Some of my friends thought I was crazy; some said they wished they had that discipline. But when I stopped caring if my friends thought it was odd that I collected cans and bottles to recycle for cash, I did MUCH better in my finances.

5. EVERY LITTLE BIT HELPS! This is the idea of "snowflaking" small amounts of money toward that debt snowball the Dave Ramsey talks about. I have record of transferring amounts as small at $3 toward my credit card debt. I sold books, DVDs, and CDs on Amazon to have more to put toward my cards. I recycled bottles and cans, unplugged appliances when not in use, and requested free samples of feminine products. Yes, those are all small things; but it led to big results in my debt payoff (check out my sidebars if you don't believe me!)

Okay readers, it's your turn: what's the best advice you received when you were first starting to get your debt paid off? And feel free to visit my friend's site to offer encouragement as she starts down this road.