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4 Ways to Find Extra Money to Put on Debt

January 9, 2020 By MelissaB Leave a Comment

4 Ways to Find Extra Money to Put on Debt

If you’re in debt, the common advice to get out of debt as quickly as possible is to get a second job and/or sell stuff.  But for some people, getting a second job isn’t an option, and there’s only so much stuff around the house you can sell.  However, there are 4 small ways to find extra money to put on debt that aren’t labor intensive but can make an impact on your debt reduction.

4 Ways to Find Extra Money to Put on Debt

You may have more money than you realize that can be mobilized to pay down your debt:

Practice Doing Without a Bit of Money Each Week

For instance, the first four weeks that you do this, just take $1 out of your budget a week to go toward debt repayment.  That is only $4 for the first 4 weeks, which almost anyone can do.  The next four weeks, make it $2 a week, so now you have $8 for the next four weeks going on debt.  By the last four-week cycle of the year, you’re at $13 a week, or $52 extra to go on debt for those four weeks.  At the end of a full year, you will have put an additional $364 on your debt.

Save All of Your Change

4 Ways to Find Extra Money to Pay Down Debt
Photo by Josh Appel on Unsplash

If you make a habit of paying in cash, try to save the change that you receive rather than spending it.  I used to do this quite regularly, and we would have anywhere from $250 to $300 in change at the end of the year, all of which can be put on debt.

Have a No Spend Month

At least once a year, try to have a no spend month.  You can decide if you want the no spend month to be only for groceries, or also for entertainment.  Now, this doesn’t mean that you don’t spend at all but that you try to avoid any extraneous purchases.  You might “need” to spend $300 on groceries for the month so you stay stocked in produce, milk, bread, etc., but if you usually spend $600 a month on groceries, your no spend grocery month will have netted you $300 in extra money.  Some people also say no to eating out or other entertainment during the no spend month to increase their savings.

Roll Extra From Any Budget Category Onto Debt

Let’s say you budget for $700 a month for groceries, but one month, there were great deals at the grocery store, and you only spent $643.  You can take that extra $57 and roll it onto debt.  Likewise, if your internet bill is $75 a month, but you call up your provider and negotiate a deal and now only have to pay $56 a month for the next 12 months, roll the savings of $19 each month onto your debt.

If, at the end of the month, you sweep all of the extra from any budget category onto your debt, you’ll likely have anywhere from a few dollars to a few hundred dollars to put on your debt.

Windfall Money

Any time you have unexpected money come your way, put it toward your debt.  You just got $1,600 back on your tax return?  Put it on your debt.  You got back a surprise $48 from your former employer?  Put it on your debt.  You use Rakuten regularly and just got a Big Fat Check for $7.47?  Put it on your debt.  No amount is too small.

Final Thoughts

While the common advice to pay down debt faster is to get a side gig, if you can’t do that, know that there are many other ways, even on a tight budget, that you can accelerate your debt repayment process.

What other ways have you found to pay down debt more quickly without getting a second job?

Incidentally, if you’re reading this because you’re in debt, but looking to get out of it, consider surfing over to our debt free family, they have a nice set of debt reduction tools that you might find helpful, here.

MelissaB
MelissaB

Melissa is a writer and virtual assistant. She earned her Master’s from Southern Illinois University, and her Bachelor’s in English from the University of Michigan. When she’s not working, you can find her homeschooling her kids, reading a good book, or cooking. She resides in New York, where she loves the natural beauty of the area.

www.momsplans.com/

Filed Under: Debt Reduction Tagged With: debt, Debt Reduction

How To Prepare Your Teens to Live On Their Own

December 30, 2019 By MelissaB Leave a Comment

Sure, you love your children, but there’s no doubt that raising them is expensive.  Many parents miss their kids when they move out, but they’re glad to be rid of a heavy financial obligation. . .unless the adult child moves back in.  Suddenly, aging parents may find themselves paying for Junior again, negatively affecting their finances.  One of the best ways to guard against that is to make sure Junior is ready to responsibly handle his finances when he flies the coop.

How to Prepare Your Teens to Live on Their Own

Since our son was about 12 years old, he has been eagerly anticipating moving out and living on his own when he turns 18.  We want to make sure that when he does move out (whether that’s at 18 or a year or two later), that he can live independently and sustainably.  These are some of the skills we’re working on.

How to Prepare Your Teens To Live On Their Own

There are some essential skills your child should master before moving out of the home:

Have a Strong Work Ethic

Some teens leave the nest never having worked a job or done chores around the house.  Kids who leave home without a strong work ethic are less likely to successfully transition from childhood to adulthood, meaning they have a higher chance of ending up back at home.

Teach children from the time they’re young to work for the things they want.  This becomes even more important as they reach the teen years.  Rather than just give your child $20 when she wants to head to the movies with friends, make her work for her money by doing a job around the house or helping a neighbor with a task.

Budget and Handle Money Responsibly

How to Prepare Your Teens To Live on Their Own

Many an adult child has moved back home saddled with debt from the college years.  To avoid this, in the high school years, teach your child how to budget.  Show her how you budget for the family and have her create her own budget with the money she earns from an allowance or part-time job.  Teach her to save for an emergency fund and to save for upcoming expenses.

Just as important as teaching her how to budget is to teach her how to use money responsibly.  One way to do start doing this is to give your 13 or 14 year-old child the money you would normally spend for her clothes for the season.  Let your child buy her own clothes with the money, and she will start learning how far a dollar stretches.  Another way to do this is to let her buy her own food.

Buy and Cook Food

How to Prepare Your Teens to Live on Their Own
Photo by Andy Chilton on Unsplash

When our son was 15.5 years old, we decided to give him a weekly grocery budget and let him do all of his own grocery shopping and cooking.  This has been interesting to watch.  The first few weeks, he ate too many carbs because they were cheap and he thought they would fill him up, which he quickly found to not be true.

The next few weeks, he had a meat heavy diet, which left him feeling sluggish.

The weeks after that, he started finding healthy recipes with balanced nutrition.  He did all of this with minimal input from us.  He learned by doing and experiencing.

Plus, he’s learning not only how to grocery shop wisely, but also how to meal plan and cook, essential skills for when he leaves the home.

Final Thoughts

Obviously, there are many steps to get a teen ready to leave the nest, but right now in our family, we’re focusing on these three as they seem most important for a teen to be able to successfully live on their own.

What suggestions would you add for how to prepare your teens to live on their own?

 

MelissaB
MelissaB

Melissa is a writer and virtual assistant. She earned her Master’s from Southern Illinois University, and her Bachelor’s in English from the University of Michigan. When she’s not working, you can find her homeschooling her kids, reading a good book, or cooking. She resides in New York, where she loves the natural beauty of the area.

www.momsplans.com/

Filed Under: budget, Children, Married Money Tagged With: budget, children, debt, emergency fund, money, Saving

Building A Monthly Budget: How to Calculate Your Costs

November 8, 2019 By Susan Paige Leave a Comment

Budgeting is always the hardest when first starting out. The idea of creating a spreadsheet with a breakdown of every monthly cost and expense is so intimidating that many people put it off for a long time.

All a budget is, in essence, is a well laid out plan. When calculating a budget, what you must do is calculate the difference between your anticipated income and your fixed costs so that you can get an idea of how much you have left for desirable expenses. You don’t have to be an accountant to know how to create a budget plan though, here are some easy tips.

·        Add Up Monthly Fixed Expenses

The first thing that you need to do when making a budget plan is to calculate your monthly fixed expenses. These include costs like rent, car insurance, payments on any auto or title loans, or insurance.

You can use a spreadsheet or budgeting app to keep things organized, and accurately access what your expenses look like each month.

·        Add Up Monthly Variable Expenses

Variable expenses are expenses that change month to month, and they can be a bit of a challenge to add to your budget plan. Calculating these costs is more of a judgment call than anything else, especially if they fluctuate greatly month to month.

Costs like groceries, gasoline, electricity and discretionary spending can vary monthly so setting aside a specific amount can be difficult. However, by averaging and overestimating variable costs like electricity or gasoline, you can write it into the budget without worrying that the actual costs will be more than what you’ve planned for.

Tips to Keep in Mind when Creating a Monthly Budget

Now that you’ve added up all your monthly costs, you know how much money you need to make ends meet. In a monthly budget, you want to compare these expenses to a monthly income. You don’t want to take into account a holiday bonus that you’re expecting in 6 months, because that isn’t affecting your expenses or income this month. For a monthly budget, use your monthly income to calculate any leftover funds after your expenses.

If you have a fixed income, such as a salary, or you are paid hourly with a set schedule, then this is easy. If your income is varied due to a fluctuating workload, then the best you can do is average your earnings.

Once you’ve calculated your excess income, you can figure out what to do with it. Ideally, you added discretionary spending as a line item in the budget, so your excess money shouldn’t just become spending cash. Any excess funds should go towards debt or savings. If you have more excess income than normal one month, feel free to spend it on entertainment or desirable expenses. Now that you’ve created a budget, you can spend money and still feel financially responsible.

Stick to Your Newly Created Monthly Budget

Now that you’ve gone through the work of crafting a monthly budget that works for you, know that you have a financial plan set. Having a monthly budget makes life easier and making a physical one can better help you visualize the numbers and make adjustments without guesswork.

Making a monthly budget is not the hard part though. The difficult aspect is sticking to the budget, tracking expenses, and not making a habit of exceeding your budget. Going out to eat is fun and enjoyable, but if you do it more than you should, your available income for the month will start to eat into any excess funds you have–and possibly exceed them! If you’ve calculated for the entire month though, splurging every now and then shouldn’t throw you off track. And if you do slip up, relax because you can always get right back on track next month! So enjoy your financially responsibility!

Image source: Pexels.com.

Filed Under: loans Tagged With: creating a debt plan, credit card debt, debt

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