Frugal Living to Increase Debt Payments

When you are buried in debt, you know that something’s really got to give. It’s either you give up your time or you give up some of the things that you were used to spending on. Most of the time, people will automatically think that they need to increase their income. However, frugality will give you more than just the means to increase debt payments.

If you try to learn how to be frugal, you learn how to live below your means. That will help you develop good spending habits and will keep you from acquiring more debts in the future. Solving your debt problems requires not just paying off your debts but addressing the reason why you got there in the first place. So by being frugal, you are actually hitting two birds with one stone.

To help you live a more frugal way of living, here are some things that you can do.

Get Rid of Things You Do Not Need

Search your attic, garage, and basement. You will surely find things that can be sold – instead of leaving them to acquire a lot of dust. It is time to organize a yard sale and dispose of them to grow your debt payment fund. Or if you want, you can sell your items on eBay.

Save Those Coins

If you think that piggy banks are beneath you – they are not. Deposit your spare change at the end of the day. Fatten up that piggy bank and you will find that it will acquire quite an amount after a few months. Every time you fill it up, put that as extra payment for your debts.

Cut up Coupons

All those dollar or cent savings should be taken into consideration. These small savings on ordinary purchases will add up to a big amount at the end of the day. It takes a bit of time to gather but you may be surprised at how much you can afford with the limited budget that you have.

Roll Up Your Sleeves Instead of Hiring

There are several household chores that you can do yourself instead of hiring someone else to do it for you. Not only will you save a couple of bucks, you will give yourself some exercise too. What you used to pay for the service can be added to your payment fund.

Convert Gifts and Bonuses Into Payments

Any cash gifts that are given to you can be put into your debt payments too. In fact, a lot of extras outside your regular salary should go into your payments. These increases can help expedite your debt reduction further. In fact, a wiser thing to do is to divide the extra money and send a part of it to your payments and another to your savings.

Aim for Freebies

Being frugal does not necessarily mean that you deprive yourself of the things that you enjoy the most. If you and your family love to eat out every Sunday, you can utilize the picnic parks in your community and bring your own food. If you need to exercise, you don’t have to spend so much on the gym. Jog on biking and hiking trails. Enjoy hobbies but find ways to get it for free (if possible).

When you think about it, frugality is a friend of financial freedom. You cannot have the latter without practicing the former. So you may want to consider this even if you prefer taking on another job to increase your income for debt payments.

The Thing About Consolidating Your Student Loan Debts

You know it and a lot of other former students know it. A higher education does not come cheap. Many students just have no choice but to opt for a loan to get them through the expense. Though a good education is an excellent investment in your future earnings, that fact may become obscure as you face the monthly obligations on loans you took out as a student.

Things Change

Maybe moving clear across country, maybe landing a job that does not pay as much as would be nice, maybe getting married, maybe getting pregnant, all this makes the student loan debt a lot more burdensome. Especially in these recessionary times, cash is tight and paying off two or more student loans seems more and more unreal.

Changing Things

You know it is no fun having to come up with two or more student loan payments a month, each to a different lender, each at different times of the month, each at a different amount, each at a different interest rate, each with a different balance due. You can change all those things.

Student Loan Things

You need to start investigating a student loan consolidation program. That way you will have one payment, to one lender, at one time of the month, at one interest rate, with one pay-off balance. Savings on paperwork and postage alone, and just plain old hassle, makes it worth finding a lender to consolidate all that debt.

How Things Works

Add up the amount you have to remit to each lender every month. Average out your interest rates among your lenders. (Calculators for figuring your weighted interest among various loans are available online. ) Examine the length of time it will take you to pay off each loan.

You will probably find a lender who can assume all that debt, offer you a lower monthly payment, offer you at least the same or better interest rate than your weighted rate, and give you a definite future date that will mark the end of your debt. Do we hear a sigh of relief?

Do Your Homework Thing

The most important thing is to do a bit of shopping around. Approach the financial aid office of your alma mater, they may be able to point you to some lenders that have been helpful to other alumni. Do a web search. You will find plenty of lenders willing to help you out. Just research carefully and always remember: caveat emptor.

Continue Your Frugality Thing

Once you get your student debt consolidated, you are going to find that you have quite a bit more cash flow each month. Do not let your earlier frugality slip away. If you were used to squirreling away money to cover your student loans in the past, why not take some of that and start a rainy day fund? Sure, let the increased cash flow grease your life a little, but do not squander it all.

Make It a Thing

You are now more in control of you financial present and your financial future. Do not let it slip away. Make it a thing for yourself.

Simplify Your Financial Situation

Are you stressed about money? Do you constantly worry about your finances and your future? The economy has been struggling and many people are worried about their financial situation. If you are struggling to pay your bills, or if you are getting deeper and deeper into debt, than you need to make some changes. One thing you can do is simplify your financial situation. How do you simplify? Here are a few suggestions:

Create a budget. Figure out how much money you earn each month and how much money you spend. The key is to make more money than you spend and put the leftovers into savings.

Coupon shopping. When you go shopping use coupons. Even if you are only saving a few cents with each coupon, it will begin to add up and you will save a lot of money overall.

Don’t buy what you don’t need. If you are trying to be more frugal and save money, than you will want to be smarter about what you buy. For example, if you have a decent pair of running shoes, than use them until they are worn out. Don’t buy another pair just because they are on sale or you think you need another pair. Wait to buy something until you really need it.

Buy secondhand. There are a lot of great thrift shops and online stores where you can buy things secondhand and a lot of the items are still in good condition. This will save you a lot of money.

Downsize. If you live in a house that is larger than what you need, downsize to a smaller one. This will save you a lot of money and you won’t feel like you have a lot of extra space that you need to buy stuff to fill it with. If you have more than one vehicle, see if you can downsize to one vehicle. One car payment is much better than two. Or if you have a large car downsize to a smaller one. Your monthly payment will be smaller and you will save a lot of money on gas.

If you are stressed about your finances than simplify your life. Take out the expenses that you do not need and quit wasting your money. By becoming a smart shopper you can save a great deal of money and put that money into savings or pay off your debts.

How to Become Motivated to Be Frugal

You might really want to save money and be frugal, but just can’t seem to get started. How do you jump start yourself into a frugal life?

Whether you are just starting to be frugal or need a little motivation to keep on saving, sometimes it is hard to keep in focus why you choose to live frugally. I am a firm believer in writing things down. I believe that once you see things in writing, they are a little more concrete in your mind.

Make yourself a frugal living notebook. This is a record of your goals, plans and actions. In the future, you can look back and see how your frugal living has benefited you over time. For example, I can flip back through my notebook right now and see how our financial goals have been met over the last year. It helps motivate me to keep going.

So gather a notebook, a pen and your budget. Your budget will help you choose your goals. If you don’t have a budget, then now is a great time to start one. It can be as simple as a list of the bills that come out of each paycheck. I list each payday on a separate page. Each bill that comes out of that check is written down. When non-monthly bills come in they are placed on the appropriate page. When I pay bills, I cross them off the list. This way, I am sure that every bill is paid each month. Anyone can pick up my book and see what has and hasn’t been paid. I subtract the total bill amount from each paycheck and allot the left over money towards savings and spending money. It’s a paycheck by paycheck budget. Since I know approximately how much each paycheck will be, I am able to plan ahead.

In your notebook, make a list of every debt you owe. List what it is, the interest rate, the total amount left and the monthly payment. Every once in a while, you will update this so that you can visually see how your debts are going down over time. It is a good feeling to see how much you are paying off.

Now, define and list your goals. Goals change over time, so be sure to update your list. You will be checking off things you accomplish and adding new goals. Be realistic and honest with yourself. Start small. At one time, my list included “pay off highest interest rate credit card.” Now all my cards are paid off, so my new top goal is to devote 10% of each paycheck to savings.

When you look at your finances, you have to wear blinders. Don’t compare yourself to anyone else. Every financial situation is unique. Just because your friends are driving new cars, you don’t need to go into higher debt to have a new car. You don’t know or want anyone else’s financial situation. Only look at your goals when you are planning how to spend your money.

Be realistic and reasonable. For example, my husband wants a new car so bad he can taste it. But we only owe eleven more payments on our vehicle. It runs perfect and is in great shape. We could go and trade it in and have a car payment of about the same amount on a new vehicle. Or we could wait eleven months, pay it off and then buy another vehicle. Then we would have two nice vehicles with one car payment. It is worth the wait, as most things are financially.

Being frugal doesn’t mean starving yourself. It doesn’t even mean living within your means. It means living life to the fullest while spending only what is necessary. We all are allowed niceties. You may be saying, why would someone who preaches frugal living be talking about a new car? That’s our perk for living frugally — bought sensibly and reasonably. Living frugally gives us the option of having a new vehicle if we choose. It’s about choices. Many of us live frugally when we don’t have choices, so that later in life we will. You have to treat yourself. It may just be a bubble bath or a free walk in the park. Its about spending life to the fullest. You can’t do that burdened by money.

Don’t fret and worry about money. Thinking about it will not change anything. Taking action will. Make a plan, refer to it often and take back your financial freedom.