I have $102,000.00 in student loans, $21,000 in credit debt, and can’t budget my way out of a wet paper bag. I make $21.40 per hr and work 36 hrs a week, my wife works and makes $11.50 per hr and works 30 hrs per week. I own nothing of value, no homes, my cars are at least 20 years old. and i pay rent.
Please help me budget my way out of this hole I’m about to bury myself in.
The first time I read your question I felt like I was right back in the middle of one of those school math problems. You know the ones, if a train leaves Chicago at noon… LOL.
Here is some good, honest and free advice to help you get out of debt and develop a budget that can work for you.
More information about how to create a budget can be found in my book, “Eliminate Your Debt Like a Pro” that you can download here for free. After you download the book, go to chapter 4, How to start doing what you need to do to get out of debt.
For some, budgeting is almost like an orgasm. They find the experience pleasurable and enjoy the feeling it gives them. For the rest of us, the majority of us, it is a colossal pain in the ass.
Even the word budget is horrible and budgets are nothing more than a page of lies or a wish list on how you would like to spend your money. A budget can defeat your attempts to storm your financial castle and cause you to lose both the battle and the war. The reason? Most budgets are not based in fact, but guesses and dreams.
Before you can create a plan on how to spend your money, a spending plan, you first need to take the time to track where you money is going. Once you can figure that out you can then make some good and informed decisions about how to change your spending habits to meet your needs.
If you don’t want to track your spending forever, just do it for the next 30 days and at the end of that time you’ll have a much better idea of where your hard earned money is actually vanishing to.
Properly spending your money isn’t about what percentage you spend on this or that. It’s about how you spread it around and the total of those expenditures that counts.
Frankly I don’t care how you spend your money as long as you can live within what you make and can save a bit for your future goals.
A spending plan will accomplish two things. First, simply by tracking where you spend your money you will reduce your spending by 10%. Second, the reason you reduce your spending is because you are more self-aware about where your money is actually going. That knowledge helps you to make choices about what you want to spend. And good information about where your money is going and good choices about how to spend what you can afford are the best building blocks to getting control over your money.
Now the easiest way to save is to make it automatic. Use a savings account that is not tied to your local bank account, one that you can drain with an ATM card. There are some really good savings accounts out there. Follow this savings account link.
With your new savings account, setup an automatic withdrawal from your primary checking account into your saving account. Start with maybe $50 a month and then move to $50 twice a month and then $50 a week. This money will be taken out without you having to do anything and will be saved automatically for you. As long as you leave that account alone you will accumulate and grow your cash savings.
I truly think that the secret to your overcoming this financial hurdle lies in automatic investment and savings and awareness about where the rest of your money goes.