Beating Broke

Personal Finance from the Broke Perspective

How to Practice Self-Care When Paying Down Debt

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Dave Ramsey says that paying off debt is more of a sprint (especially when you’re gazelle intense), but if you have a lot of debt, the payoff journey may feel more like a marathon. If you keep your nose to the grindstone without a break, your physical and emotional health may suffer. Practicing self-care will help you not only remain in good health but also have the stamina to see your debt-free journey to the end. Here are some tips you may want to utilize to care for yourself while working hard on paying down debt:

Make Sure You Have a Fun Money Fund

I know, you may feel like all of your money should go on debt repayment, and, yes, almost all of it should. However, set aside a small amount for fun money for the month. When my husband and I were paying down debt, we each got $20 for the month. I used mine to buy treats at the grocery store that weren’t in my budget or we sometimes used the money to get a dessert at a restaurant together. This money should be yours to spend any way you see fit and to give you a little wiggle room in your budget so you don’t feel deprived.

Do Something Just for You Every Day

What do you enjoy doing? Some people enjoy spending time in their gardens, running, doing yoga–the choice is yours. When I was working three jobs in my 20s, I enjoyed nothing more than coming home after a 12 or 14-hour day and slipping into a bubble bath. That was the perfect way to destress and relax.

Start a Pinterest Dream Board

Do you have a major goal when your debt is paid off? Maybe you’ve always wanted to visit France, and that’s how you plan to celebrate being debt-free (after you’ve saved cash for the trip, of course). Why not start a Pinterest board of all the places you want to go and things you want to see? You can create this board for any dream you plan to realize when your money is no longer going toward debt. The best part about Pinterest is that you can make the board secret so only you see it.

Make Your Meals at Home

Let’s face it, paying off debt and working hard to make extra money can be stressful and exhausting. While you may be tempted to grab quick food, know that doing that regularly can have negative effects on your health. Take the time to make homemade food. You’ll feel better, be healthier, and have more energy.

Listen to an Audio Book

You may not have the free time to sit down and read a book, but when you’re driving to and from work, why not listen to an audiobook? It can be a fiction book you listen to just for fun, or it can be a non-fiction book that will help you in your career. Gazelle intensity is exhausting and stressful, so make sure you make time to relax and take care of yourself.

Don’t Take On Any New Debt

Lastly, whatever you do, avoid taking on any additional high-interest debt. Amanda, over at Our Debt Free Family has a very nice review of Click Cash Go, which is an exemplary high-interest debt marketplace to avoid. So, avoid any additional borrowing – that’s a huge part of self care.

 

What are some of your favorite ways to practice self-care?

Some Years, No New Debt Is Reason To Celebrate

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When you’re in debt, it’s easy to be hard on yourself.

You shouldn’t have let yourself go into so much debt. 

You weren’t smart with your money. 

You’re not paying off the debt fast enough. 

On and on we berate ourselves.

It’s even easier to do this at the end of the year when you feel financial pressure to buy gifts for not only family members, but associates, hired help, etc.

In addition, if you’re anything like me, you may have set some lofty goals last January that you could not achieve.

Our Lofty Goals

Last January, I could see nothing but clear horizons.  I set some ambitious financial goals (for our financial situation).

  • I wanted to put at least $3,000 in our emergency fund.
  • I wanted to save $1,000 for a family vacation.
  • I wanted to save $3,000 for a new-to-us car.

Guess how many of those financial goals I accomplished?  None!

Guess how many I partially accomplished?  None!

No new debt celebrate

Sometimes Finances Are Just about Survival

What I could not see that fine January morning when I set my goals was that we were on the precipice of a financial cliff.

Within just a few weeks of setting the goals, we experienced a number of financial difficulties.

  • My husband had to get a root canal and a crown at the cost of almost $600.
  • I had to see a periodontist and several dentists for a cyst on my gum that finally resulted in a root canal in April and a corrected filling. The cost of all the treatment was approximately $700.
  • Our daughter had to have several fillings filled and then later had to have a tooth pulled. $300.  (This was a special year for dentistry; I promise, our teeth aren’t as bad as this year makes it sound!)
  • Our car needed a $1,500 repair.
  • Our car needed new tires. $700.
  • My son needed braces. We saved and paid the first $900 out of pocket.  In a few months, we’ll need to come up with another $900, and then we’ll be on a payment plan with zero interest for the rest.
  • Our 18 year old A/C unit was leaking Freon, causing one electric bill to be $150 more than normal, and we also paid $200 to have it serviced for a grand total of $350.

In short, this year was a financial disaster as far as paying off debt went.  This year was all about financial survival mode.

And that’s okay.  Some years you can’t be gazelle intense or even pay any extra on your debt because you’re too busy just surviving.

Even though the year didn’t go the way we had planned, at all, it wasn’t a complete wash financially.

The good news is that we learned more creative ways to stretch our money even further.  We’ll continue to implement those strategies this upcoming year.

The even better news is that we didn’t acquire any new debt.

Sometimes, treading water is the best you can do.  Overall, for this year, I’m happy with that.

If you’re paying off debt, did you make the progress you wanted to this year, or did you have a year like ours?

Are Good Deals Putting You in Debt?

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We all love a good deal, right?  There’s nothing better than paying $2.40 for a pair of kids’ shorts that retail for $16 or paying $0.25 for Christmas wrapping paper at an after Christmas sale when it would cost you $2 or more to buy it new.

After all, buying things on clearance is what savvy shoppers do, right?  This is an excellent strategy for being frugal with your money, right?

Well, yes. . .and no. Are those good deals putting you in debt? Ask yourself these questions and decide if you really need that good deal.

Do You Buy More Than You Need?

Good Deals DebtWhen something is on clearance 80% off, it’s tempting to buy alot. . .more than you need.  After all, why buy one sweater at $5.00 on clearance when you could buy 8 for the cost of what just one would cost retail?  Besides, you’re not paying any more than it would cost to buy a $40 sweater brand new, and you’re getting 8.  What a deal!

But do you NEED 8 sweaters?  Will some of them languish in the back of your closet, with the tags still on, until you decide to purge your closet and give them away or try to sell them at a garage sale?

Can You Afford It?

Sometimes, you need to pass up good deals.  If you can’t afford the deal and put it on credit card, are you really saving money?  By the time you figure in the interest you’ll pay, that clearance sweater may end up costing you nearly as much as it would cost retail, or, if you pay only the minimum payment on your cards, even more!

Some people have gone in debt in pursuit of good deals.  Kristine Rogers, who was featured in Money magazine, explains that she went in debt buying children’s clothes on clearance: “Gymboree held a clearance sale in which every item was priced at $7.99. ‘I grabbed clothes my daughter didn’t need.  I bought four of the same coat in different colors.’  By the end of the day, Rogers’ compulsion had cost her $800.”  Rogers developed a full blown shopping addiction in the pursuit of sales and ended up with $50,000 in credit card debt!  Sure, she got good deals, but in the end, after interest, she likely paid much more than she would have if she’d bought the items at retail.

Are You Tying Up Current Cash Flow?

Assuming you don’t go into debt to buy good deals, you may still be tying up your cash flow.  If you spend $40 on 8 sweaters that you buy in May but won’t wear until November, you’re tying up cash flow.  If you don’t wear some of those sweaters at all, you’ve wasted money despite the good deal.

Be More with Less explains, “If you buy wrapping paper on December 26th and stock up on sale items year round, you are spending more than you would if you just bought what you needed.  Don’t be fooled by the cashier that tells you, ‘you just saved $22.00’ when you just spent $300.”

What do you think?  Is it worthwhile to pursue good deals, or can it be a slippery slope to overspending and debt?

Do you buy items on clearance?  Do you always use all of the items, or do you accidentally buy too much?