Sunday, January 26, 2014

Resolution #1

With the recovery from the Great Recession under way, there are two conflicting things that are needed.  For the recovery to continue, people need to spend money.  The problem is, people have become obsessed with celebrity without the money to pay for it.  They are financing themselves to their graves.

This year is the year I plan to change that for me.

I've got some big pluses on my side:

1.  My home is paid for.  This is a big one.  During the housing boom, my friends were trying to get me to sell my home and "upgrade" to a nicer one.  I said no.  I am so thankful I did.

2.  I limit my credit.  In other words, I don't have a wallet full of credit cards.  I only have 1 major credit card.  My line of thinking has been, "if I can't afford to buy it on my one credit card, I can't afford it."  Period.  The two exceptions to this have been medical bills and my car loan.

When it comes to money, there are big consequences associated with people's choice of lifestyle.

In order to have a more abundant life, there are two things each person must do:  they must play good offense, and they must play good defense.

Good Offense = job that pays enough to cover the bills + saving.

Good Defense = limited spending that allows for saving.  This means people who have a spending problem, need to get on top of it in order to be able to save money.

This year I'm looking to cut down as much debt as I can, which means cutting out a lot of unnecessary expenses.  I'm on the right track:

- I don't have a cell phone contract.  I don't talk that much on the phone, so the contract plans were a waste of money for me.  I have a TracFone from Walmart and I just add minutes as I need it.

- I don't have cable tv.  I'm not home enough to warrant the amount of money I was paying for it.  I've not had it for a few years and I've not missed it.  I have DVD's and I do pay for internet service.  I also use an antenna and converter box for the local channels I was already watching, so it has worked out for me.

- I'm not a big shopper.  Seriously.  The only time I'm really dangerous is when I'm in a bookstore.  Those I only go to for specific things at specific times of the year.

One area I'm not good at defense:  online shopping, namely iTunes and iBooks.  Those I have to watch out for.

My sources so far:

Oprah's Debt Diet I have the DVD's for the series of shows on this, they are a great way to start.

Money 101 This is coming from the people of Money Magazine and contains a wealth of free information to help get anyone out of debt and into saving and investing, if they are willing to make the sacrifices necessary.

Provident Living - The Church of Jesus Christ of Latter-day Saints - be sure to download the One For The Money booklet.

A recent development will hopefully help people to make better choices about their money.  I have friends who have taken payday loans out and ended up in such arrears they had to file bankruptcy to clear out these loans.  Score one more for the little guy:

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