25 Ways to Use the Change of Season to Change Your Financial Life
Fall is truly here.
For many people, the Fall season is a time of beginnings as much as endings.
As leaves change color and drop from the trees, the crisp autumn air brings with it a sense of change. It feels like the right time to take stock and get things in order. Maybe this goes back to the childhood cycle of the school year starting in September. Fall is the time to start fresh with a clean slate.
For a variety of reasons, Fall is a good time to assess your personal finances and decide if you need to make some changes.
Following on the heels of Fall will be Winter and the Holiday Season. For most of us, Winter is the season of shopping and entertaining. If you’re still paying off some debt from last year’s Holiday Season, you’re not alone. Before you’re bombarded with advertisements and enticements to overspend, this is a good time to take stock of your finances and develop a plan to deal with debt.
Maybe you spent more money than you intended this summer on a vacation or now have school expense to deal with. These are additional reasons to spend some time planning exactly where your money should go over the next few months. Your Holiday Season will be more enjoyable if you have some sense of control over your financial future.
Here are 25 suggestions to help you assess your financial situation, avoid and eliminate debt, and prepare for the future. You may not be able to put them all into practice this Fall, but making even a few changes in how you handle money this Winter could make a big difference in where you stand next Fall.
1. Create a spending plan for the Holiday Season. Determine how much you can spend with no debt or minimal debt, and then stick to your plan. For next year, open a Holiday savings account and contribute a small amount to it each month.
2. Avoid debt when possible. Always use cash except for big purchases like a home, car or major appliance.
3. Keep track of your debt every month. Create a spreadsheet showing your current debt balance, recent payments and interest (this can really add up if you don’t actively pursue low interest rates, see #9 below). Update this spreadsheet each month.
4. Stay focused on your debt. Ignoring it won’t make it go away and will probably contribute to its growth.
5. Make regular monthly payments on your debt and try to pay more than the minimum required payment.
6. Come up with a plan and deadline to eliminate your debt. When you create your plan, be realistic about monthly payments and don’t make them so large that you don’t have enough left to cover expenses each month.
7. Be realistic about how long it will take to get out of debt. It probably took several years of spending to get you where you are and may take a while to get out of debt. Make your plan realistic.
8. Have patience. Like saving, debt elimination is a slow process that takes time.
9. Take advantage of credit card balance transfers when they make sense. Moving your debt to a card with a 5% interest rate will save money compared to 18% or 20% rate. Just remember to read the fine print and calculate the transfer fee to make sure it won’t eat up the money you’ll save with a lower interest rate.
10. Track your expenses for a few months and then create a monthly budget that you can live with. This means planning where your money goes each month. Be sure to leave some “wiggle room” for emergency expenses.
11. Look ahead to upcoming expenses such as taxes or car maintenance and set aside money to cover them.
12. Start an emergency savings account. Put some money into every month, even if it means paying off less on a credit card.
13. If you spend a lot on entertainment, come up with some low-cost alternatives. Rent movies instead of seeing them in a theater. Visit parks, zoos and museums in your community. Check out your city’s website for information free community events.
14. If you eat out often, limit meals out to once or twice a week. Besides saving money, you can make it a goal to prepare healthier meals at home. Also, spending time cooking can be a low-cost form of entertainment!
15. Cut down on book and music purchases by visiting your local library.
16. If making more money seems like the only solution for paying off your debt and avoiding future debut, then take on another job. This may seem impossible in the current economy, but there is freelance work available if you look for it. Take a good look at your talents and what you have to offer and do some research into how you can make money by working a few extra hours a week. Avoid work that involves an investment on your part or depends on friends to buy a product.
17. Cut the clutter in your home. Don’t allow it to accumulate again. This means cutting down on the number of new purchases you bring into your home.
18. Use things you have instead of buying new things.
19. Read up on finances and budgeting. The more you know and the more you focus on the art of personal finance, the easier it will be for you to create a plan and follow it.
20. Think about your retirement. It may seem very far away, but if you start saving when you’re young your senior years will be more comfortable. Start a 401K or maximize your contribution to an existing 401K. Do this painlessly through a pre-tax payroll deduction.
21. Avoid looking at catalogs and advertisements. They’ll just make you want to spend.
22. Become an independent consumer. Resist the pressure to buy something because other people have it.
23. Keep your larger goals in mind when you’re considering buying the latest gadget or new clothing item. A mountain of small purchases stands between you and your goal of purchasing a home or buying a car or other major item. Limit the size of that mountain.
24. Live beneath your means. Spend less than you earn. Simple as that.
25. Focus on non-material things of value. Most of life’s most valuable things are intangible and free. Seek out the love of family and friends, the beauty of nature and the rewards of music, art, literature and sports. Don’t let yourself be defined by your possessions.
“Rule No.1: Never lose money.
Rule No.2: Never forget rule No.1.”
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Posted on November 11, 2009