Incredible Tips on Cutting Down Debt!

Welcome to Day 5 of the $10k Mini-Series!

 

Step 5 of how I’ve paid off over $10,000 of my debt since January is to…

Identify Why You Buy!

Why do we take such great pleasure in buying things? Why does having “more” bring so many such comfort?

Maybe it provides a primal level of mental security, knowing you won’t go without. Or maybe, for some, it’s more of an ego-related feeling – “I’m wonderful and people will know that when they see I have these wonderful things!”

Perhaps it’s because you had nothing growing up and having “more” means staying away from those icky feelings from the past.

Here are some questions to help you pinpoint why you buy:

  • Do you feel the need to “keep up with the Joneses”?
  • Does your brand loyalty hurt your budget?
  • Are you distracting yourself from inner dissatisfaction with new, shiny play things?
  • Do you think brand name guarantees high quality?
  • Are you addicted to luxury?

If you cannot identify “why you buy” then you will be unable to say “no” when the desire for more arises. By allowing yourself to constantly want, want, want, you are forcing yourself out of the present and living for what might be, for what you might acquire.

That’s not to say you shouldn’t live for the future. As you know, I’m all about developing long-term plans in order to kick debt to curb. However, you should focus on what will be, not what could be.

As is the case with budgeting your life overall, a long view of your purchases can help with this – a new shirt at full price might be $50 now, but that same $50 taken off of a credit card balance with 22% interest can end up being $60 or more.

Being able to view a purchase in terms of how much it will cost later on versus the immediate need to fulfill a desire will help immensely in avoiding impulse purchases. Like the adage “nothing tastes as good as being skinny feels,” no unnecessary purchase can bring you the peace of mind and reduce your stress like obtaining financial freedom.

Likewise, living in the past isn’t always a bad thing either. Think about where you were a couple years ago and what your household income was. Now think about what your expenses were. Are you spending more because you make more?

If you are in debt, you should not be upping your lifestyle to fit your current salary!

I know so many people who made $40,000/year, got a raise or better job, and instead of putting that additional income towards debt, they have now somehow incurred $10,000 more in expenses (often without realizing it!)

So how do you break these habits and learn to be happy with less?

Well, one of my favorite things to do is to keep a gratitude journal. I recommend against notebooks, simply because the covers are often flimsy, and you want to be able to carry this around with you. Any time you’re feeling down or you’re tempted by an extravagant purchase, pull out your journal and write down five things you’re grateful for.

Doing this will make you happier overall. I guarantee it.

Another thing to help you on your road to satisfaction with less is to consider where less already makes you happy.

For example, less clutter can equal MORE money and that almost certainly helps improve your mood, no? From the humble beginnings of trying to clear out stuff when we moved a couple years ago, to now where I almost constantly have stuff up on Facebook garage sale/resale groups, I’m averaging around $500 per garage sale and nearly $100/month on Facebook. Since November 2015 alone, I’ve made nearly $750 from selling things we no longer need (and this includes kids clothes that I actually got for FREE!)

I recently read a great book called The Brain That Changes Itself and one part that really stuck with me was that the more you practice saying no, the easier it’ll become.

So for today’s homework: Practice saying NO. Not just to others, but to yourself. Not only will this go a long way in helping your financial state, but it’ll actually re-wire your brain and lead to a healthier, better life overall. How cool is that?

Which is easier for you – saying no to others or to yourself?

More on the 10K Series:

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