Following up on my previous post I’d like to list a few ways to manage your money better. Whether you want to get out of debt or save up some money for the bigger or smaller things, those are the simple steps to start your journey. I will focus on two main starting points in this post and write a couple of separate ones to break down everyday ways to manage your money.
Before you go any further, one thing that is very important- you must take this shit seriously, stop fucking about and be aware that there is going to be some real self-discipline needed.
1. Set yourself a goal and a deadline for it.
So first things first, if you are in debt, paying it off should be your very first and most important goal. I’d like to dedicate a separate point to this, so I’ll talk about it in more detail next. For now, I want you to understand that saving up for the extra things that you REALLY want is pointless until you pay off the money you owe. But even if you don’t have any debt (you lucky bastard) keep reading.
Set yourself a goal and be SMART about it. I don’t know if you’ve heard about the SMART goal system, but if you’d didn’t you’re for the treat. It is very helpful to see if you choose your goals the right way (it works for any type of goals, not only money related). Ask yourself if your goal is:
For instance, in my case, I wanted to pay off my debt to start saving up for a flat. A couple of Specific goals, right? The fact that my goal is going to be achieved the moment I paid off the debt and saved up enough money to buy a flat means that it’s Measurable. Is it Achievable? Yes, I have resources (regular income and enough of it to put some of it aside) and it has been done before by others. Realistic? I’ve done my budgeting, got into the right mindset and I committed to it, it is within a reach given the time and resource. Realistic indeed. Timely? I’m literally about to pay off my last instalment towards my debt and I wanted to do it by the end of 2020 (Woohoo). I want to have enough money to pay a deposit for the new flat in two years’ time. So here it is- a deadline. Timely it is.
Having a plan and being well organised is the key. If you’re not the most organised person in the world, don’t worry. Maybe one of your friends is good at it? Maybe you could find some suggestions online? You can also hit me up if you need some advice ;). Asking for this type of support is always acceptable.
2. Get Rid of Your Debt!
Ahh, the good ol’ debt… NOT! Literally the demon of mine. I’ve set up a PayPal credit in 2016 because I really wanted a MacBook Air. Very impulsive purchase, haven’t done my research about the product OR online credits, it was trendy to have it (MacBook- not the credit), so I thought “Why the hell not”? Well, maybe because you can not afford it? Maybe, because you’re about to spend the money you don’t actually have? Very stupid and very immature of me. You can read the brief story about the trouble I got into because of that in my previous post. Long story short from £1,600 credit I got up to £3,300. I got into this loop of spending money I didn’t have and was paying the minimum payments only. Sometimes even skipped the payment because I didn’t have any money, which made my debt even higher. By the end of 2019, my partner told me how stupid I was for not taking control of it- in a nice way… or maybe not, I don’t remember. All I know is that he was right. It was the harsh truth but I really needed to hear this to get my shit together. It was a long journey with ups and downs. By the end of September 2020, I owed PayPal around £1,600 so I was pretty much at the starting point. I still felt like I’m not achieving what I wanted because it’s only three months till’ the end of 2020 and I have so much money to pay! Being lucky to have my partner with his shit together he decided to loan me the remaining amount. I’m not gonna lie, I felt so shit about it. Thinking “I don’t want a knight in shining armour saving me”. “What if that changes things between us and if I fuck it up we start falling apart”? Money is known for ruing relationships right? BUT it only motivated me to pay it all off ASAP. Why? Because I was aware of how hard he worked to save up this money. Because I don’t want to put our relationship in jeopardy for a stupid reason like fucking money. And here it is, I will be debt-free TODAY because I couldn’t stand the fact that I owe money to someone I care about.
So just to be clear, in the end, I actually paid off my starting amount of credit in three months and I’m sure I could have done that in 2016. Instead, I dragged around this shitty credit for four years because I couldn’t resist buying shit and didn’t know how to stop this loop. Also, I was always rubbish at saving up.
I think sometimes when you’re in debt and you just paying minimum payments, you get on with your life, and it feels like everything is under control. Then it takes forever to make this final payment, yet you’re kind of comfortable, and you can still afford some random shit you MUST HAVE. You’re paying these minimum payments, then you occasionally can use the credit again- how convenient right? But guess what- you still spend money you don’t have and you owe shit to someone!
When it comes to paying off the money you owe, try to:
– Create a deadline for when you’d like to pay it off in full. Be realistic and stick to it. And obviously celebrate once it’s done ;).
– Pay the maximum, not the minimum. The minimum payments are designed to keep you in debt forever. You’re a perfect catch for them greedy bitches from credit companies.
– Resist impulsive buying. Think ten times before you take your card out to type all the magic numbers in. Sleep on it. Wait a week or two… Or a month, see if you really want it and if you actually love it. If you do- don’t fucking buy it because you still have a fucking debt to pay off. (You can slowly put some money aside for it though;). You survived a month without it so it can wait until you’re debt-free.
– Delete all your cards from devices you use to buy online. The fact that you can buy nearly everything with one click nowadays is so tempting because it is easy and you don’t really feel that you spend your or loaned money. Maybe, the time you take to get your lazy ass up to grab your purse or cardholder will give you a chance to reflect and re-think spending money you don’t even have.
– Be patient. This is a long-term process. If you can’t afford to pay your debt off right away, create a plan, and stick to it. Once you complete it you’ll be so satisfied with yourself that no other saving up challenge will be hard for you. Once you go through the long and painful path to a debt-free zone (which really is difficult at the beginning only), trust me you’re going to feel like a new person and this heavy debt-motherfucker on your shoulder will no longer exist and you have one problem less to deal with. Don’t we enough of shit going on? Let’s get our finances together at least, shall we?
Having financial peace is highly connected to your mental health. When you pay off the money that you owe someone, you instantly stop worrying. With the experience of taking control over your money, you gain self-confidence, hell a lot of self-discipline, and the feeling of achievement. For someone like me who hasn’t achieved a lot is a huge deal, especially after struggling with it for four long years.
In the next Every Penny Matters series, I’ll break down everyday ways on how to save up some money so you can pay that debt off faster or buy something you love without getting into stupid credits.
Let me know what you think and your ideas to save up money in a comment section or drop me an email. I’d be extremely happy to hear from you.
Lots of love, Selfish Jo.