This is our weekly installment of The Debt Diet Challenge, in which Credit.com follows the lives of five people selected to take Jean Chatzky’s Debt Diet—to get themselves out of debt and on track to a better financial future. Every week, Jean Chatzky updates us on the participants’ progress, and the participants blog about their experiences with the program. Here are the latest dispatches from our participants…
On August 1st, I set up a new expense worksheet to track my expenses for the month. In doing so, I reviewed how we did for July. I am amazed that I did not buy take-out lunch at work once. That alone was about $40 per week savings. I amazed that we did not use the credit cards to buy anything. I had one exception. I signed my son up for fall soccer online. The website looked a little flimsy so I used my credit card to pay and then went online immediately and sent the card the money for it so it wouldn’t be added to my bill at the end of the month. That felt so good. My husband and I have fought for years about credit card use and I’m embarrassed to say that it took Jean Chatzky to scare us into doing something about it. I know there were only a few of us accepted into the program, so my advice to anyone is to find someone that you can be accountable to help you get out of your mess. Telling someone that can make you feel embarrassed and ashamed about your behavior is equally awful and beneficial at the same time. As long as we could keep it hidden and a secret, we didn’t deal with it. My husband was not happy that the world would know how horrible we have been with money but if we didn’t start living with this in the open it wasn’t going to change until a financial collapse, job loss or sickness made us deal with it. He is so proud now that he can announce that he didn’t use a credit card this month and we are not fighting about it. Definite progress!
I am trying to balance all of the things we need to do to get our debt down and have a more balanced relationship with our money and finances. For the first month, I put a lot of pressure on myself to get a lot done. We did reduce our debt by $4,000 this month which is about 3.5% of our total. (I believe we have the biggest chunk of the group.) We were able to do this by taking some vacation time so we didn’t have to pay for babysitters, cutting back expenses, not using our cards and paying more than the minimums on our credit cards. We needed this boost to see progress in the beginning. Paying for full-time child care will be a big chunk of spending again for August so we have to go deeper on the expenses.
[Resource: Correcting Errors on Your Credit Report]
This past week I was feeling overwhelmed and tired on my call with Jean and needed to find some energy to take it to the next level. She was very helpful in reminding me that it is OK to say ‘no’ sometimes for projects at work and to keep lists. I was asked to attend an early morning meeting in September and instead of immediately saying yes, which I usually do, I paused and I am looking into whether or not this is necessary. I need to step back and challenge every decision I make in my life right now. An early morning meeting seems like no big deal but the babysitting costs can add up if I do too many in a month. I need to value my time and money more thoughtfully.
Making a list helped me save substantially on a birthday gift coming up. Usually I run around last minute and overpay for whatever I can find. I made a list of many things I needed to do this week and month and the gift was on the list. I went this weekend (one week early) and bought the present with a coupon and bought gift wrap and a card at Walmart instead of the greeting card store. A gift that normally would have been $25-$30 plus $4 for a card and $6 for gift bag and tissue paper cost me $17 including card and wrapping paper. That is a huge savings and I still have a gift that I am proud to give.
Jean also recommended that I write down my expenses as they happen, rather than try to gather my receipts and remember what I spent for the day. I still haven’t cut back on the Dunkin Donuts ice coffee which runs about $2 a day and we ate dinner out more with our vacation days off than we should have. I am sure it was on purpose that I didn’t want to write it down right away, but after looking at these totals for the month I think we need to push ourselves a little harder here.
[Featured Tool: Get your free Credit Report Card from Credit.com]