When Brian and I decided that 2019 would be our year to get debt free, I knew we had to start January 2019 out strong. I’m a firm believer in going cold turkey with things, especially things that negatively effect your life. That’s why I am starting out this year with some strict tactics for myself to get into the habit of living simply and breaking old spending habits.
I’m writing my top 7 tactics I am going to use to success in my debt-free journey – I determined these were best for me. They may not be best for you, but overall they are ideas that can help you pay off debt, save money, and live more simply!
No Spend January
This is a popular tactic to use in January, and it’s going to be a huge challenge for me – which is why I’m starting the year off with it. If I tackle my BIGGEST challenge first, then all the little challenges will be seemingly simpler.
How to do a “no spend” month?
- Don’t spend any money outside of necessities. Necessities are bills, food, gas, basic care items, utilities, etc. Not a necessity; a $4 latte. Get the picture?
- ONLY buy what you absolutely need.
Tips for doing this successfully:
- Don’t use credit cards
- Stop Amazon auto-ship (unless those are your 100% necessary items you buy)
- Do free date-nights
Stop using Credit Cards
This is a hard one for me (and for many!) I trapped myself into the mindset that I can use my credit card, get the points, and then I’ll pay it back as soon as I get paid. But the truth is, I spend more than I will have to cover the statement, and that is how debt is occurred.
Full Disclosure: I have one credit card I use to buy gas because I get 5% back, however I only buy $30 of gas a month, and I have it set on auto-pay so every month it pulls out exactly what I spent from my checking. THOUGH if I feel this is hindering my savings at all, I will stop doing this completely.
- Take your credit cards out of your wallet, and put them in a drawer that you don’t frequently use.
- Remove auto-fill from your computer and phone so it’s not so easy to online shop (I swear autofill credit cards are the best and worst thing ever invented)
Only purchase items you can pay for then and there in cash
This goes hand in hand with not using credit cards – I only buy something if I can pay for it in cash (using my debit card). My checking account is where my paycheck is deposited, so I know exactly what I have in there. If I want that $5 coffee or that $40 rug on sale at the store, then I have to consciously know that it is pulling it straight from my pay check and bill fund.
If you get into the mindset that you don’t even HAVE credit cards to use (just pretend they are GONE) then would you still buy all the unnecessary items?
We all have automatic subscriptions that we don’t need or fully use. This is what you should do to figure out what you have and how much it’s actually costing you: Write down EVERYTHING you pay for monthly (besides bills, utilities, gas, food). Netflix, Hulu, Gym membership, membership to Costco, etc. Do you use them all? If you’re on the fence about it – break it down by the day. My gym costed me $1 a day, but I work out at home 90% of the time, so I decided to cancel it. It may seem like a trivial amount, but it can easily equal hundreds of dollars a year.
Sell extra items
I know my home is full of EXTRAS. Extra shoes, clothes, books, furniture..we even have 3 laptops we don’t use anymore. Instead of letting all the extra sit around, sell it. It doesn’t matter if you get $5 a pop for everything – use that money to pay a bill, or put it in a rainy day fund.
If your items hold no value, donate them. You can use the donation as a tax write-off, but more importantly, having a clutter free house will make you feel better, and enjoy the items you DO have.
List out debts and pay them from smallest to largest
This is not the approach everyone has, but for myself, this is the best approach. I lose momentum when I don’t have any gratification, so if I start paying off my debts from smallest to largest, I will feel that I am checking things off my list and it will keep me going!
For instance – I have a bunch of small medical bills, vet bills, credit cards with smaller amounts, and those are what I will tackle first. This does not mean I am abandoning other bills or debts. I am still paying my monthly minimum on all other bills, but I am putting any extra money into those small bills until they are 100% gone.
If you do make a purchase, make it wisely!
I can’t go a year without getting my hair cut, or going on a date with Brian, but when I do, I make a smart decision. We go to matinee movies, go to restaurants where we have a gift-card or coupon for, etc.
I am also renovating my house this year, and I don’t plan on stopping that to pay off debt. I thrift shop, and am very good with budgeting. If I order anything online, I always use Ebates which gives me cash back. (I use that cash back every quarter to put into savings!) I also starting using Brandless, which is an online store for everyday household items at inexpensive prices that end up saving me money. Every penny counts on your debt-free journey. (Sign up for your free Brandless account today and get $6 off your next order: https://refer.brandless.com/s/s74cs)
I am so excited to use these tactics, and hear about it if you use them! Paying off debt and putting some money into savings doesn’t have to be so scary when you break it down and make small everyday changes. Don’t beat yourself up for having debt, just make it a fun and challenging journey to pay things off!
This is so good, Katherine. Thanks for sharing your journey with us. We are working towards this goal as well and I will definitely implement a few things you discussed here.
I’m so glad Tasha! I hope these help you – it’s a long road to a debt-free life but if you break it down into small doable tasks, it doesn’t seem so bad!