- This topic has 169 replies, 22 voices, and was last updated 4 years, 2 months ago by Silje.
August 9, 2017 at 8:23 am #696671MissDreGuest
I feel like I’ve been struggling with this topic overall as well. I’m sure there are ways I could be more frugal, and I’ve been trying to cut things out wherever I can.
But I read this article the other day and I think (hope?) it’s really going to change things for me.
I actually sat down with an excel spreadsheet and allocated my income according to this advice. Of course I had to make a few tweaks since certain expenses in my life are fixed. BUT I decided to really focus on saving and just stop stressing about my debt. This article suggests no more than 5% of your gross income go toward debt, so even though I feel like it’ll take me forever to pay off my line of credit, I just have to stop caring and PAY MYSELF FIRST.
My hope is that by building up a really strong savings account, it will prevent further debt. This way, I’ll have access to actual money when things come up (like car repairs) rather than being like “oh shit, I’ll put it on the credit card!”
Also, one thing that might be a struggle is fun/entertainment/spending money. I left that category to the very last, so I can only spend what’s left over after the other categories are taken care of. It really isn’t much. But now I can just enjoy whatever I earn from being an Airbnb host. I no longer need to worry about bringing in a certain amount of money on the side to cover expenses. I can just enjoy whatever I do earn.
I’ve already set up automatic transfers for everything within my online banking account.
I definitely hope this makes a difference in my life!August 10, 2017 at 3:21 am #696806SiljeGuest
If noone has suggested it already, I highly recommend the blog of Mr. Money Mustache. He has a frank and brutal way of looking at unnecessary spending and thoughtless debt, and there are a lot of great tips. Not sure if I am allowed to link to a site, but it is mr money mustache dot com all in one of course.
He does the math of what it actually costs to live far away from your job, how to reduce the costs of living in the house you have, and most importantly, how to become satisfied with living with less (stuff, debt, stress). Yeah. I like it.
But to the topic, I expect they save nothing and get loans instead. And can not then start to save properly as all of the “savings” will have to go to the highest-interest credit card. And then out of money at the end of the month, take some more credit to make up for it. Bad cycle.
Also possible here in Norway, coworker spent 16000 dollars for a three week summer holiday to Florida last year (her, boyfriend plus daughter), still pays for it and can not afford a summer vacation other than tenting this year. Got some tax refunds last month, what to do? New sofa of course.