Before I took control of my financial life, actually paying the bills, actually writing the checks (back in the days before everything could be paid online–I’m dating myself again) could be a little traumatic. When I changed, I realized I started to enjoy what used to be the dreaded monthly ritual. Why? Because it’s not so bad when you actually have money with which to pay them. The stressful part came when there wasn’t enough to go around. If you’ve been following along with my advice, you should have plenty. The end of the month is here, in this case, February, and it’s time to pay the bills for March. You have money, go ahead and pay them. As you pay each one, remember to deduct that payment from each corresponding “account” in your notebook that you “filled up” last month. And that smallest debt (or maybe two) that has more in it that the payment requires? SEND IT ALL! EMPTY THAT ACCOUNT! Hopefully, it will be enough to totally clear that debt, but if it isn’t, you will hav...

Okay! You’ve got money in all your “accounts.” You are ready for the monthly ritual of the "paying-of-the-bills" for next month instead of playing catch up for the month behind. You might even have a little extra. Maybe you have a little left over from your tax return after padding all those accounts. And remember when we mentioned those one or two extra paychecks a year? Here is what you do with that surplus: put it in the account of the smallest debt. “But, I have enough money to make that payment already,” you say. Yes, but we are not JUST making the payment, we are GETTING OUT OF DEBT which means we’ve got to pay EXTRA when we can. So do it. Put that extra money into that account with the smallest balance. “Ok, so I put in enough to match the balance of what I owe, and I STILL have money left.” That is FABULOUS! Take the excess amount and put it on your NEXT smallest debt. Keep doing this until all the extra money is accounted for. Pretty soon your money...

This budget system works best when you are earmarking money today for items that you are paying for NEXT month; you want to be putting money away now (February) for what you have to pay out next month (March). “But I’m so far behind, I’m late all the time and I’m always paying late fees. There’s no way I can pay when is due YESTERDAY let alone save for NEXT month!” Here is where it gets brilliant. This is the BEST time of year to begin this program because you can USE YOUR TAX RETURN. Follow the steps from last week, “Math is Hard,” using the money you got back from the US Treasury. “But, I was going to get a new iPhone (or insert whatever you WANTED here) with my tax return…”   If you get on this plan and stick with it, you will have FREEDOM which is worth SO MUCH MORE than the cost of whatever you thought you HAD to have with your tax return. And, I promise, you will be able to get one eventually. You just got a new iPhone last year; it will last you a little ...

Last week, you named your pages (let’s call each one of those pages and “account”) and assigned the monthly dollar value to each one. For instance, you have an account for your mortgage or rent, an account for your gas, groceries, car payments, etc., all living expenses and debts. Now you need to “put money” into those “accounts.” How? You do it when you have money come in on payday. There will be other times when you add money, but mostly it will be on payday. Here is where it gets a little tricky. How many times a month do you get paid? If it’s once a month, then your job is easy. When you get that monthly check, you sit down and, starting with living expenses because they’re more important, write the monthly amount (aka the monthly payment) that expense required. I would start on line one at the far left side and put today’s date, a plus (+) sign, and the monthly amount. At the very right side, I would write the world “balance” and the same amount you just put in (because ...

Now that we are really getting to the part where you have to track your spending and tell your money what to do, you might say to yourself, “I’m not sure I can do this,” or “Well, I will start next month.” Don’t wait until you are upside down to begin any of the income-increasing or debt-reduction strategies we have talked about. The more you can cut expenses and increase your income, the faster you will be able to get rid of your debt. And, this time of year is the PERFECT time to get started. Why? Because it’s TAX RETURN TIME. Many people totally BLOW their tax returns, but YOU know BETTER. Making a plan for your tax return dollars (just like making a plan for your monthly income dollars) can really get you ahead and set you up to win. Set your sights on the debt-free target ahead and don’t let anything deter you. Use your notebook ( or the bookyou got from Amazon ) to track where your money is scheduled to go before you let it leave. Here’s how: Write the name of one b...

There are many people who, once they write down everything and actually stick to their plan, feel like they’ve gotten a raise. Being in control will do that for you. This week’s task is to figure out every dollar that is going out. Add your total monthly debt payments to your total monthly expense payments. The total should be less than your monthly income. If not, then you have been living way beyond your means and you are probably using credit cards to just “get by” every month. If this is the case, you need to make some fast, hard adjustments to reduce your living expenses and/or get more money coming in. Here are some questions to ask yourself and your significant other: Is my television service really that important? Can I eliminate my home phone/can we find a cheaper cell plan? What subscriptions are we paying for that we can eliminate? How much are we eating out or “having drinks”? Can we brown-bag lunches? Can we combine trips in the car? Can we sell a car with debt and...

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, Medica...