Cash Money, Honey

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In a recent post I laid out three steps I need to take to get out of debt:

  1. Whenever I get a big splash of consulting income (about four times a year) or a tax return, push it to paying off debt.
  2. Every month after paying off bills and before paying any debt, leave enough money in our checking account to have on hand for the month’s spending needs, from groceries to music lessons to the yard guy to out-of-network doctors bills.
  3. Then put the remaining amount toward paying off the cards.

I’ve been doing one and three for years. But two? It never even occurred to me. Since way back, when we had some inheritance, we got in the habit of paying for everything with credit cards and then at the end of the month paying off every penny. Credit cards were simply a convenience. We were what’s known as transactors, though we kept dipping into that inheritance to pay off the cards every month. But then after 2008, that inheritance was gone, except for some retirement accounts.

And so we turned from being transactors into being revolvers, carrying debt that each month got bigger. Whenever I had an influx of income, whether from paychecks or consulting, I’d put as much as I could toward paying off the cards, leaving hardly anything at all in cash for groceries and other spending that month.

Cue the crashing sound of a ten-car pile-up an an icy interstate.

I was so intent on trying to pay things off that I didn’t leave enough for now—for not borrowing now.

On other things, I’m pretty smart. I’ve written lots of books and articles and given keynote speeches around the world. But on money I’m as stupid as can be.

So now, no matter how much I want to see that credit card debt drop in record time, I’ve started a little emergency fund and I’ve left more than enough money in the checking account to see us through the end of the month. Then with the next paycheck I’ll go back through steps one through three, and the next month I’ll do it again.

Resolutions from the 6%

Some people are skinny fat, I’m rich poor.

According to CNN Money, my household income is in the top 6% of the country. But for reasons I’ll detail later—like my insane credit card debt—it’s time to resolve to embark on a year of no shopping, that is, no shopping for clothes, bags, jewelry, or shoes, and to rein in my wanton grocery shopping.

Stopping frivolous spending is obviously worthwhile, especially given how many pairs of Fluevogs I own. But food? I’m going on a grocery budget because my family of 3, sometimes 4 when one kid is home from college, has been spending an obscene amount on groceries, on average about $1,800. Add in alcohol and restaurants, and it comes to an outrageous $2,700 per month.

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Compare that to what is supposedly the average of $151 per week (times 4.2 that’s $634/month)  or what one site recommends at $125 per person per month, which would for us be about $450 a month!!! Even the generous USDA site says that extravagant spending would amount to about $1,000 a month for our family. I don’t want to be extravagant, but I can’t begin to fathom how to spend as little as $600 per month on food and drink, so I am going to do my best to keep the food and dining bill to under $900 a month.

Resolved… Ready, set, go to

  • a year of no shopping for clothes, bags, jewelry, or shoes
  • a food and drink budget of $900 a month.

As of December 31, 2017, this is a brand new blog, so I have at the moment zero readers. But if one or two or more happen by, feel free to leave a comment, confidentiality guaranteed. Are you struggling with anything like this? Or am I truly alone with this embarrassing dilemma. Are you embarrassed by your extravagance? Or living beyond your means? Or maybe just super irritated that I am complaining about my first world problems?