the spend diet

So anyone who knows me well, or reads this blog relatively often knows about my love / hate relationship with money. I’ve made some super-fucktard, super-costly decisions for the last 6 years (800 dollars in unpaid NZ parking tickets, anyone?), as well as just really, REALLY liking to shop. And story of my 20s – didn’t think of down the road, and just put it on a credit card. Dumb, dumb, dumb.

I’ve dabbled in extreme budgeting before, but for the wrong reasons. I was never really that dedicated, or it was to impress someone else besides myself, and it didn’t stick. So about 6 weeks ago, after essentially hitting bottom, I sat down on my living room floor and decided something needed to change. I HAVE to stop this and crack down. I am so tired of being a slave to my debt and living paycheck to paycheck. I have grown tired of having goals in life that I’ll never do since I haven’t seen myself having the money to do it. Never being able to travel, not being able to move, not being able to invest, or take a job in another city. As I know it, my debt has become a total hindrance to me actually living my life.

Now granted, I’m not some silly twat who just racked up $40k in shopping, nor do I hit the slots, NOR do I have any sort of upside down situation. I’ve got a manageable amount of debt (about $5k), as well as a not-too-terrifying student loan (under $20k), which is why I’m just like, what in the actual hell Laura. Pay this shit OFF already.

So: I’m putting myself on a spending diet.

I stumbled onto this site about 6 weeks ago, and after reading it for about 2 hours, I determined it was totally a manageable plan for someone like me. This chick seems a lot like myself, and is the first to admit it’s gonna suck. But she also gives tips on how to make spend-thrift life suck less, on what to consider a “want”, how to manage a social life, etc etc.

So what does this mean? Needs-based purchasing only + set budget, essentially.

How long? As long as it takes to get my credit card debt paid off, and to meet my personal savings goal. My student loan is a more long term goal, but I’m hoping this time of financial diligence and conservation will help it to become more of a natural mindset.

First order of business: making a list of my needs. I laid out everything I spent money on each month – everything – and decided what was realistically what I couldn’t live without. Rent, Insurance, Food, Car, Medicine, etc. I have budgeted a set amount for each flexible needed cost that I’ll work with. I didn’t want to be totally miserable, so things like the washer/dryer stayed (laundromats? and in winter? NO), but things like Netflix? Nope. Anything considered a want, and not a need, is canceled.

Next up: I’m figuring out where on my NEEDS List costs can be reduced. Already, I’ve sat down with my insurance company to renegotiate, I’ve signed up for more basic (and $15 p/m cheaper) internet, and I’ve found ways to reduce my grocery bill. I don’t have plans to turn on my heater until it hits a certain mark on the thermometer, and will only keep it at 68. So yes, I plan on budgeting for Dura-logs for my fireplace and wearing sweaters inside. A cold stingey nerd, if you will.

I’ve also called up each one of my credit card companies and renegotiated. Let me tell you one tip: if you threaten to cancel your card (my original intention), credit card companies suddenly become your best friend. For one company, I told them I was canceling because I had determined that most of my monthly minimum was being absorbed by fees, and by the time I got off the phone, they had taken off several months of fees, which took off over 300 damn dollars off my bill. I also managed to renegotiate the APR on 3 of 4 of my credit cards to a much lower rate.

Then: stop spending money! Yes, I will need to learn how to say “no”. To myself, to others. Of course, since I don’t plan on becoming a scroogey hermit, I’ll budget monthly for a social life and things that pop up (here’s how she recommends doing it). The non-needs budget will be between 100 and 200 – the amount isn’t firm just yet.

And of course: debt-snowball the SHIT out of my credit cards. (what that is)

Also: find ways to increase income. This isn’t an absolute MUST, but it would help. I’d like to increase my freelance (no more pay-in-trade) and perhaps take on another job.

I will be creating a page that details what I consider needs, wants, my budget, and my debt-payoff progress. It’s really for the sake of my own tracking and accountability 🙂

So, we’ll see how we (continue to) go. I’ve actually done pretty well and I just need to keep up the motivation. I’ll likely be posting about this 2-3x a month… my apologies in advance if this topic gets tiresome.

On a related note:

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2 thoughts on “the spend diet

  1. Two weeks ago, we not only decided to stop buying wants, we decided to get rid of almost everything we don’t need. It’s been really great for changing my perspective on wants vs. needs. For instance, everytime we went out, I wanted to hit the bookstore and buy yet another Writer’s Digest book. For some reason, I think buying the books will make me a better writer. But I never read them! I was totally embarrassed the time I had to return a book because when I took it home to shelve it, I found out I already had one! Anyway, I’ve decided to sell everything I haven’t used, and it’s a lot! Hundreds of dollars worth of books. But because I’m getting rid of everything I don’t need, I’m not even tempted to buys stuff like that anymore. We’re selling clothes, cars, my piano, you name it! So when I see something in the store, and it doesn’t make the cut of things I can’t live without, I have no problems just passing it by anymore. Plus, we’re making a little cash from selling off what we don’t use. Not nearly what we paid, but more than what we would make if the stuff just sat on our shelves for the rest of our lives. Good luck with your spending diet!

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