Faye's Blog

It’s that time of year again, one year has ended and New Year has begun. The joy of the Holiday season has passed. We’ve experienced the love and generosity of others and returned the love and generosity as well. It is usually around this time of year when the “horse drawn carriage” turns into a pumpkin and reality strikes. The credit card debt we had before the Holidays is still with us and more than likely it has increased. Many of us have no idea how to start paying off this debt and how to begin saving. It is time to take charge by making a firm commitment to reduce our debt and start saving and pledging to not spend money we don’t have. Here are some helpful tips for saving money each month, and with the extra savings you can always pay down your credit card debt, invest in a tax deferred retirement plan or put money aside for a down payment on your future dream home.

First, create a simple budget. This will show a clear picture of the money coming in and going out. I am often surprised at the number of clients I talk to who have no idea the status of their household budget. (For an example of a simple budget worksheet, login to my website at www.trustedmortgageloans.com) To create your budget, start by listing your household necessities such as; rent utilities, groceries, car insurance, health insurance, and gas for your car along with the monthly cost for those items. Next make a list of expenditures you consider to be luxuries such as; eating out, manicures, pedicures, brand name items (do you really need that $300 Coach bag?) , ordering alcoholic drinks with your meal, going to the movies etc. and include the monthly cost for these items as well. Now review these two lists and you will be surprised at the amount of money spent on items that are not necessities. The challenge now is to determine more cost effective alternatives which will result in monthly savings for you and your family.

Here are some more ways you can save; do general household repairs yourself, consolidate your credit cards into one card with a low interest rate, request a refinance of your car loan to lower the payment, consolidate your landline and cell phone costs (you may discover you don’t need both services), and instead of paying extra each month for the special movie channels on cable, check into Netflix or Blockbuster offers on line for movies. Consider researching car pools to get to and from work. Dry cleaning all clothing including the washable items can be expensive so just dry clean those items that cannot be washed by hand or in the machine.

If you examine your monthly obligations closely and determine ways to cut your expenses, you will be able to save at least $200.00 per month. Some of my clients discovered they were wasting as much as $800 per month! With your savings you will be able to pay down your debt and start saving too.

The main idea here is to develop a habit of saving money. Pay yourself first. These ideas are used by millionaires who have attained their wealth and carried minimum debt.

Whether you pay down your credit cards, save for a down payment on a new home or invest in a retirement plan, these are all steps you can take toward attaining financial freedom.

Article was printed in Ventura Star February 6, 2011