Your paycheck isn’t doing as much as it used to, and it has nothing to do with inflation. As you make your way down the budget categories you realize the money you make is going into several areas where there are more red highlights than black. In other words, you’re in debt. Every time this ritual is performed you declare the time is now for your young family to become debt free. However, the red numbers keep getting bigger.
Though part of the problem is money management, the other is the fact you’re not properly answering the questions you ask yourself. In addition to the reduction of expenses, the quest to become debt free requires willpower and the ability to adjust your habits, and those ingrained practices require different responses to your internal queries. Without a shift in understanding there’s every chance debt will continue to grow. To help you along the path of attitude adjustment, here are some new answers to your repeated questions.
Is it a need or a want?
The four-burner, stainless steel gas grill calls you over each time you enter the hardware store. As you admire its clean angles and shiny surface the thought I’ve got to buy this rotates through your head, and you’ll probably whip out the credit card to bring it home. That is, unless you change the statement to the following question – do I need it or do I want it?
Whether it’s a candy bar or a four-burner gas grill, every purchase has an investment value. The bigger and more expensive the item, the more thought is needed to determine if you’ll receive some return from the cash you dole out. Taking the grill as an example, will its purchase help you reduce costs in another way, perhaps lowering your home electric or gas bill since the oven isn’t used as much? Or do you want it because it looks good and everyone else has one? This brings us to our next question…
Do I want to keep up with the Joneses, or the Smiths, or the Nokotoomis?
Probably not, since they may be in the same circumstances when it comes to debt. Sure, they have a new car and go on a two-week vacation to Hawaii every year, but you have no idea how they’re paying for it. When it comes to finances, it’s best to shy away from what the Smiths have or do. Instead, look inward at how you can keep your family comfortable on both a financial and spiritual level.
Can I sacrifice enough to get out of debt?
Yes you can, and it won’t require a whole lot of sacrifice as long as you have a plan. If you decide to reduce your debt by shutting off the water and feeding your family peanut butter & jelly sandwiches for every meal, your idea will quickly fall off the tracks. However, if you list your debts from smallest to biggest and eliminate unnecessary expenses from your budget, the sacrifices you make will be minimal and your rewards will be greater.