Where do you start?

iVillage Member
Registered: 02-11-2004
Where do you start?
4
Wed, 12-07-2005 - 3:44pm

My husband and I currently have about $15K in unsecured debt. I am not afraid to make adjustments in life and spending to attack this. Based on what we make and what our bills average, we should have (based on the spreadsheet from this blog)$500-$750 extra. This still accounts for saving in an ING account ($200/month) and 401k is already taken out, so I don't even count that, as well as $160/month for kids college. I just don't feel like we are getting ahead. I don't want stop the 401 or college, or ING for that matter. (I have wanted to have $3500 in a bank account for emergencies for a while)

Where do you begin though? I feel we should be able live within our means with what we make, but I just can't seem to make headway. Advice?

iVillage Member
Registered: 03-27-2003
Wed, 12-07-2005 - 8:55pm

Congratulations on saving ahead for the future! I wouldn't change that if you have the 500-750 extra each month. It sounds like you just aren't sure where that money goes-I would get 2 small notebooks 1 for you and 1 for your husband. Each of you should write down every cent spent over the next few months. At the end of the week-take some time to compare notes and see what expenses can be cut back or where that money is going. Here's what I do-

I have a word document that lists my husband's salary and then I subtract every fixed expense (car payment, mortgage, student loans, etc.), then I look at what remains and budget out money for expenses that I can adjust such as groceries, eating out, clothes, etc. I always want my end number to be 0. The target debt of the moment (right now we're working on paying off second mortgage has the extra amount added to the required so it's just another fixed expense.

Hope this helps,

Taleyna

iVillage Member
Registered: 02-19-2004
Wed, 12-07-2005 - 10:13pm
I like the idea of the notebook to record all expenses for a couple of months. I think I'll try that myself. I definitely don't know where much of my money goes.
iVillage Member
Registered: 10-23-2004
Wed, 12-07-2005 - 10:46pm

I am not sure if I fully understand what you are asking, but I do have a suggestion that has helped me in the past.

I once had several unsecured accounts in various amounts. I felt depressed that I could not seem to pay off any of them, so I took some advice that I read somewhere. It said to pay minimum on all the accounts, and then pay all that you can on the account with the smallest amount due. Then once that is paid off, you tackle the next smallest account.

Some people advise to pay off the account with the highest interest. But when you tackle the smallest amount, it will be paid off faster, and you will feel like you have accomplished something faster. No more feeling like you are not getting ahead.

Good Luck!

Avatar for cl_phocid
iVillage Member
Registered: 03-26-2003
Thu, 12-08-2005 - 8:52am

HI there and thanks for posting.

All my best,
Danni