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Decisions, Decisions


Last week I assigned you a task: “list all your debts in the order of that preferred method on the first page of your notebook along with their balances and monthly payments.” Hopefully, your debts did not fill up the entire notebook, because you also need to account for your living expenses.

You: “So, what things are considered living expenses?”

Me: Thanks for asking. Living expenses are items that you will continue to pay for even if you don’t owe anybody a thing. If you work for someone besides yourself and receive a paycheck, some of these expenses are automatically taken from your paycheck. There are probably more living expenses than most people realize, so here are some hints: Rent, Charities, Savings—Emergency, Retirement, College Funds; Taxes—Income, Real Estate, Auto; Alimony/Child Support (which should technically go away sometime, but it’s not really debt, so we’ll list it here); Child Care; Home Repairs and Association Dues; Medical—Deductibles, Co-Pays, Medications; Utilities—Gas, Electricity, Water, Trash, Phone, etc.; Insurance—Auto, Home, Renters, Life, Health, ID Theft, Disability or Long Term Card (two of which we will cover in another blog post in the near future); Cell Phone, Internet, and/or Cable; Grocery and Non-grocery Items; Eating Out; Clothing; Gifts/Christmas; Mad Money and Vacations; Pet Supplies; Music Lessons and Sports Activities; Transportation—Gas, Oil, Car Repair, Tires,  Car Replacement.

Here is your task for this week: list all your living expenses on the second page of your notebook along with their average monthly payments. If you are not sure of an average, look at what you spent on them in 2019. For instance, total all the money you paid to the electric company and divide it by 12–that is a good average of what you gave them every month last year. Do that for each living expense if you need to. And, if you want to put them in any special order, do it according to importance (just so you know, rent, insurance, and electricity should come before cable, eating out, and vacations). For some people, deciding the order of importance is going to be gut-wrenching.

So, get on with this week’s task. I wish I could say the pain will end soon, but I’m afraid we’re going to drag it out a few more weeks. Get your antacids ready.

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