Getting Debt Free.. How did you do it or are trying to do it?

[mrsmac]

Hi Everyone,

I am new here but have been an admirer of the site for a long time. I have couponed on and off for about 2 years. Recently my fiancé and I bought a house and it seems since we have bought it, the bills have just been stacking up. Not just for the house but for other things too! We have had it out about money more than once not because we are mad at eachother but more so the situation. My fiancé is currently in year 4 of trying to get divorced... $7000+ in lawyer fees and $1200.00 a month in child support for his kids that live with us 1/2 time... but that's a whole other topic!!!

Anyways, I finally decided to get serious about money and serious about what we owe. I can't run from it forever. Joining this site was the first step for me.

I just need some simple and easy solutions to help us spend less. Couponing is something that I need to do more often, living off of our stock pile, etc. I rarely buy anything that isn't on sale. We both have vices- mine coffee and his energy drinks. Ive been making mine at home lately and I try buying his drinks @ wholesale club so they are a whole heck of a lot cheaper. I am just looking for some creative ideas to try and save money & get out of debt. It is my goal to be debt free in 3 years, that is when our support payments should go down significantly. I just don't want to feel like we are struggling so much. I know that it is possible I just need some help!!!

[GoStumpy]

Couponing is such a small portion of spending less, I don't like to focus on that.

Getting out of debt is very simple.

Spend less than you make, apply the difference to debt.

You can either spend less, or make more. Or both.

I started getting out of debt when I was $1500 in overdraft, all CC's were maxxed out, and every paycheque dissapeared within days of receiving it.

I now have extra $ in my bank account, and I am averaging ~$900/month towards debt repayment, which is almost 20% of my income.

You need to get SERIOUS about this, and have ALL the family on board. You cannot do this alone. My wife took 4 months to get on-board, only once I started withdrawing cash, and putting it in a safe place, did she finally realize that we actually ARE saving a lot of money... hundreds and hundreds per month.

We're not out of debt yet, but we're probably 50% there, and I only started in October, with $8000 in CC debt...

Since we've finally figured out this money thing, we're actually going to use a chunk of money to finally pay off two and a half of our credit cards once and for all, and take out a small (under $6k) loan to replace a vehicle that was totalled. We're going to have consolidated all our 3 credit cards into one low interest vehicle loan, and we'll be able to continue applying that $900/month towards it, and pay it off in under a year.

I never thought this would have been possible a year ago today. A year ago today, my rent cheques were bouncing, my bank account was always red, even when I got paid, and I couldn't afford to fix anything if something went wrong.

It feels incredible to get out of that debt burden, even when the debt is still there, once you've seen the progress we've seen, it doesn't feel so bad anymore.

Best of luck, and feel free to ask any questions, I am happy to share any and all of my story.

[MillieH]

I'm fortunate in that I grew up extremely poor as in not having enough food to eat, winter boots with holes in the bottom of them, etc etc. When I got married, I always lived below our incomes. When the baby bonus came that went directly into a savings account for their education, its not alot but it added up over time. I didn't buy name brand clothes for them or me.. I shopped at used clothing stores and yard sales.

Gifts for family and friends have always been within our means. I remember one year everyone got a dozen macaroni angels painted gold and sprinkled with glitter for their trees.. another year it was Stumpkins.. these were activities done with the kids and then were gifts.. sometimes I made gift certificates for gifts of time or babysitting or a ride to a friends house.. or a day without chores.. I absolutely adore when someone gives me a gift that entails them spending time with me.. it touches me.

If you are going to eat out.. drink water with lemon.. its free and greatly reduces your bill.. if you usually get dessert.. stop at mcdonalds after and have a cone or sundae..

When I shop, I pick up the item and think do I really want this.. oftentimes I put it back.. if I do keep it in the cart.. I ask myself again when I get to the cash..

I never used a cellphone until 2 years ago I got one because for 40$ a month my husband and I can talk unlimited.. he is away 90 days at a time.. I used it once to make an outgoing call when I locked my keys in my car.. otherwise its only used to talk to him. If you have a cellphone ask yourself if you really NEED it.. if you have call answer and those other addons.. an answering machine will do the same job and its usually included in a regular land phone now. We have a tendency to think, its only $5.. those little $5 add up to alot of money.

Don't look at your income as the total money you can spend that month. Instead look at your actual cost of living for the year, which is actually 13 months. If you dont remember the extra 4 weeks.. you will be short some of the time causing you to dip somewhere.

for example
I worked out my expenses for the year
Electricity
Water
Gas
House & Car insurance
Taxes
Medications
Pet insurance
Outtings
Treats
Groceries
phone/satelite/internet
gas for car
clothes

Once I figured out what my total was, I divided it by 12 and then deposited that amount in my spending account on the 15th of each month. In my case I needed 2,100$

I set up transfers & bill payments to happen every month on the 16th

$600 goes to savings.. 300$ of which goes toward buying a new car and 300$ to general savings
the utilities are all paid on the 16th before they are due.. I know how much they will be so I had 10$ extra to each one and once a year or so I get a full month free.. that money I put into savings. The exception to this is electricity.. I put 25$ extra a month to cover the cost of A/C in the summer.. I always spend more in the summer because of A/c

I used to pay $119 for pet insurance but the most risk of injury and /or chronic health issue (in my mind) appears in the first year.. so I paid for them both the first year and now I transfer the $119 monthly to a savings account to cover any expenses that they will have.

Once the 16th is past.. the balance remaining in my account is for groceries and spending money. I do use a credit card but I pay the balance the same day I purchase. If I don't have enough in my account to do a purchase I don't buy it.

I never fear my bills coming in.. they all have credit balances or are even.

I look at income tax as FREE money, its like a surprise.. and not included in my budget, so it goes into savings.. we used to up it into RRSPS but I favor the tax free accounts now.. its less confusing to my tiny little mind. One of the doctors I worked with always had to pay in.. so I set had her open an account and deposit 1/12 of her usual payment monthly.. when she did her taxes at the end of the year, the money was sitting there, all she had to do was write a check.

the thing is to do preventative rather than crisis care. It really removes stress.

Dont pay banking fees.. We bank with presidents choice, no fees for checks, no limits on how many times I use my card, I do think there is a fee if I use a bank other than CIBC but thats not necessary when there are drive thru branches and you plan your spending in advance.

Slow cooker is your best friend.. prepare supper the night before, refrigerate.. put it in the slow cooker in the morning and when you come home.. supper is ready. At the end of a working day its so much easier to order pizza or pick up junk food than to consider cooking supper and what to make.. instead come home.. eat a delicious meal and relax for a little while.. makes your day so much nicer.


Open a bank account, set it up that 50$ a month is automatically sent to that account.. it becomes automatic.. in a year you will have $600........ in 10 years $6000 .. you can and will do more but that little start, seeing something grow.. helps you see that it works.. don't let that account be added to your debit card.

In the beginning I found I squeaked by.. now I always have extra left over.. I transfer it to a spending account that I can treat myself to anything I want.. "fun money"

We are near retirement now.. in fact I had to stop working 15 years ago.. my husband will retire next summer.. we arent rich but we our home and car is paid for.. we have no debt.. and have saved enough to continue living with the same expenses as we have now..with a little cushion


I hope some of the stuff I shared will help you.. it takes a while to find your way.. I wish you every success.. try not to get too frustrated.. everything begins with baby steps..

[momof5boys]

Great points and I'll add...ALWAYS shop with a grocery list in hand....try reducing your grocery total each month - make a game out of it - and you will be amazed how much you can actually save. Forget about restaurants. Also, shop the outside aisles of the grocery store and make real food! Much cheaper!!!

I'm fortunate in that I grew up extremely poor as in not having enough food to eat, winter boots with holes in the bottom of them, etc etc. When I got married, I always lived below our incomes. When the baby bonus came that went directly into a savings account for their education, its not alot but it added up over time. I didn't buy name brand clothes for them or me.. I shopped at used clothing stores and yard sales.

Gifts for family and friends have always been within our means. I remember one year everyone got a dozen macaroni angels painted gold and sprinkled with glitter for their trees.. another year it was Stumpkins.. these were activities done with the kids and then were gifts.. sometimes I made gift certificates for gifts of time or babysitting or a ride to a friends house.. or a day without chores.. I absolutely adore when someone gives me a gift that entails them spending time with me.. it touches me.

If you are going to eat out.. drink water with lemon.. its free and greatly reduces your bill.. if you usually get dessert.. stop at mcdonalds after and have a cone or sundae..

When I shop, I pick up the item and think do I really want this.. oftentimes I put it back.. if I do keep it in the cart.. I ask myself again when I get to the cash..

I never used a cellphone until 2 years ago I got one because for 40$ a month my husband and I can talk unlimited.. he is away 90 days at a time.. I used it once to make an outgoing call when I locked my keys in my car.. otherwise its only used to talk to him. If you have a cellphone ask yourself if you really NEED it.. if you have call answer and those other addons.. an answering machine will do the same job and its usually included in a regular land phone now. We have a tendency to think, its only $5.. those little $5 add up to alot of money.

Don't look at your income as the total money you can spend that month. Instead look at your actual cost of living for the year, which is actually 13 months. If you dont remember the extra 4 weeks.. you will be short some of the time causing you to dip somewhere.

for example
I worked out my expenses for the year
Electricity
Water
Gas
House & Car insurance
Taxes
Medications
Pet insurance
Outtings
Treats
Groceries
phone/satelite/internet
gas for car
clothes

Once I figured out what my total was, I divided it by 12 and then deposited that amount in my spending account on the 15th of each month. In my case I needed 2,100$

I set up transfers & bill payments to happen every month on the 16th

$600 goes to savings.. 300$ of which goes toward buying a new car and 300$ to general savings
the utilities are all paid on the 16th before they are due.. I know how much they will be so I had 10$ extra to each one and once a year or so I get a full month free.. that money I put into savings. The exception to this is electricity.. I put 25$ extra a month to cover the cost of A/C in the summer.. I always spend more in the summer because of A/c

I used to pay $119 for pet insurance but the most risk of injury and /or chronic health issue (in my mind) appears in the first year.. so I paid for them both the first year and now I transfer the $119 monthly to a savings account to cover any expenses that they will have.

Once the 16th is past.. the balance remaining in my account is for groceries and spending money. I do use a credit card but I pay the balance the same day I purchase. If I don't have enough in my account to do a purchase I don't buy it.

I never fear my bills coming in.. they all have credit balances or are even.

I look at income tax as FREE money, its like a surprise.. and not included in my budget, so it goes into savings.. we used to up it into RRSPS but I favor the tax free accounts now.. its less confusing to my tiny little mind. One of the doctors I worked with always had to pay in.. so I set had her open an account and deposit 1/12 of her usual payment monthly.. when she did her taxes at the end of the year, the money was sitting there, all she had to do was write a check.

the thing is to do preventative rather than crisis care. It really removes stress.

Dont pay banking fees.. We bank with presidents choice, no fees for checks, no limits on how many times I use my card, I do think there is a fee if I use a bank other than CIBC but thats not necessary when there are drive thru branches and you plan your spending in advance.

Slow cooker is your best friend.. prepare supper the night before, refrigerate.. put it in the slow cooker in the morning and when you come home.. supper is ready. At the end of a working day its so much easier to order pizza or pick up junk food than to consider cooking supper and what to make.. instead come home.. eat a delicious meal and relax for a little while.. makes your day so much nicer.


Open a bank account, set it up that 50$ a month is automatically sent to that account.. it becomes automatic.. in a year you will have $600........ in 10 years $6000 .. you can and will do more but that little start, seeing something grow.. helps you see that it works.. don't let that account be added to your debit card.

In the beginning I found I squeaked by.. now I always have extra left over.. I transfer it to a spending account that I can treat myself to anything I want.. "fun money"

We are near retirement now.. in fact I had to stop working 15 years ago.. my husband will retire next summer.. we arent rich but we our home and car is paid for.. we have no debt.. and have saved enough to continue living with the same expenses as we have now..with a little cushion


I hope some of the stuff I shared will help you.. it takes a while to find your way.. I wish you every success.. try not to get too frustrated.. everything begins with baby steps..

[beckie.c]

I feel for your Fiancé on the divorce side, my parents put the lawyers kids through university twice by the time they were done.

If you haven't already, go through 6 months worth of finances with a fine tooth comb. Find any leaks in your financial bucket that you may not have realized and plug them. How about your fixed expenses can they be cut anywhere? If you have two vehicles can you go down to one and use public transit? Before you buy something, can you borrow it instead? Can you take on a short term boarder? (My husband has 8 weeks in a different city for school we are paying $1000 to have him use someone's spare bedroom!) can you reduce the interest rates on your debt?

Anytime you go to purchase something, ask yourself if it gets you closer to your debt free goals. If the answer isn't yes, then don't buy it find an alternative. You will have to make sacrifices to get to where you want.

Don't forget to set aside some savings, that way if something serious does come up you aren't going further into debt.

"BE committed to DO what it takes to HAVE what you want."

Check out Gail Vaz Oxlades book Money Rules and Debt Free Forever (from the library), they have been super helpful!

[mandolinatou]

I also am working on the mortgage. It feels over-whelming as it is currently about 3 times our annual pre-tax income. I am fortunate in that I grew up poor so I don't have to sacrafice to live below my means. My lifestyle is amazing compared to what I grew up with.

I actually don't coupon at all. I work full time and have a young child so I don't think I have time for it. I will trade though with couponers some times. I don't own a personal cellphone and have not owned one since immigrating to Canada. I feel like Canadians are getting screwed with the telecommunications ogliopoly. I don't pay bank fees ever. I never spend more than I make. All my daughters clothing is used. My furniture is mostly all used. I only use air conditioning when I need it. I use public transport....thats a big one. I never owned a car until 2013 because cars eat the budget majorly.

The other thing I do, is I try to make money in everything I do. I know this sounds weird. However my hobbies are all about getting paid to learn something/enjoy myself or having the potential to make money doing it. As an example I paint for joy but I also hope to sell my paintings. I took a very easy part time job that let me watch movies during work....because I watch movies so why not get paid to do it. I worked in a cafe because I liked their sandwiches. My next not career related part time job I hope is home depo (so I can learn to do my own home repairs) either that or a tour bus leader (which pays me to travel). I therefore do not pay much money for my hobbies...in fact by year end I tend to make money with my hobbies. I also pay very little to travel.

So thats how I have money at the end of the month. My home is small. My needs are small. I have no idle time at all.

[Frugalbigmama]

Great advice everyone! For me I really watch what I spend on groceries. Shop the sales ( plan meals from the sales) if apples are on sale then that is our fruit for the week. Same with veggies. No packaged food (waste of money and not healthy) Meat- shop the sales and buy enough for the next few weeks. Chicken on sale this week then I'm only buying chicken. If you don't have time to cook on a work day then plan the meals for the week on your day off and prep what you can. (Last night I bbq'd tons of chicken so we are having chicken stirfry tonight, chicken wraps tomorrow etc.

[blueeyetea]

Mrsmac, apart from wanting to spend less, what else are you doing for your finances? Do you have a budget? Are you keeping track of all your expenses?

Adding to what MillieH says, anticipate what you need to spend money on and have the money in the bank before you spend it. For example, taxes come every year, divide the amount by 12 and deposit that amount in the bank every month. When the bill comes due, you’ll already have the money available. It’s a lot easier (and less stressful) to pay bills when you have money in the bank than playing catch-up. Basically, what I’m saying is that you need a budget to cover your fixed costs, like housing, car payments, insurance, etc. The rest, like groceries, some utilities, clothing, are discretionary and the most likely candidate where you can scrimp and save.

For groceries, couponing is great if you have the time, but there are other strategies that will give you more bang for your buck. Your aim is to buy and eat what’s on sale. Baby steps are to start by planning your weekly menu based on the sales flyers that come every week, but a black belt tightwad uses a price book and the pantry system to reduce their costs. By keeping track of prices in a price book, you eventually start recognizing when products are really on sale and when the sales come around. For example, peanut butter is cheaper at the beginning of the school year and in January. As much as possible you want to buy enough peanut butter to last you until the next sale.

To start the pantry system, begin by making a list of meals you cook often and start stocking the ingredients. For example, you make a ground beef casserole every week with one pound of meat and a can of tomatoes? Well, when it comes on sale, buy 6 pounds of ground beef and 6 cans of tomatoes and you have six week’s worth of casserole ingredients in your freezer, and at a lower cost. Although you have to disburse more at the beginning, in the long run, your costs go down because you get into the groove of shopping from your pantry for your meals, and everything you buy is on sale. Looking at it another way, it’s cheaper buying 6 pound of beef at $3.99 ($23.94) than $3.99 one week, $6.99 week two, $4.50 week three, etc.

Adding to the pantry system, I also suggest you look into OMAC (Once-A-Month Cooking) also known as freezer cooking, frozen assets, and batch cooking.

Although written by Americans, you can get a lot of frugal ideas from the books: Cut Your Grocery Bill in Half by the Economides, and The Complete Tightwad Gazette.

Finally, if you want to have a real impact on reducing your spending, you and your fiancé need to look at how the spending is affecting your life, and what is causing you to spend money like you do. I’d suggest you get yourself the book “Your Money Or Your Life” and do the exercises, which will make you look at your purchases in such a way that you’ll be happy to give up your coffee, your self-described vice. It’s all about looking at your purchases and figuring out the real reasons on why you bought them in the first place and how much value they are bringing to your life.

[brunt]

I won't go into the gory details, but I got completely out of debt in '98.

In my case, we were hit by a double whammy business-wise, and we got to the point where I was literally counting the weeks until we could no longer cover the mortgage payments. I've always been frugal, but what hit us could not be solved by clipping coupons.

We decided to go the more "drastic measures" route.

Our biggest problem was our income, not our expenses, so that is what I attacked. I decided to look for, and take, the job that paid the highest amount, while still being in an area that was not insane for living expenses.

I had been looking for a job for a while (over 200 resumes sent out with very few offers, and nothing of interest), but then I decided to extend my search to the US. I sent out two resumes, and received two good offers, and I took the higher one.

In the high tech field, the rate of pay in Canada really, really stinks. The job that I took in the US gave me an immediate 300% pay increase (that's not a typo).

We sold the house (thereby paying off our one and only debt), we moved and rented in the US for four years. But most importantly, we continued to live our frugal lifestyle despite the higher income. (As an aside, I had a humourous conversation with a chap down there who insisted that it was impossible (in 1999) to live with an income of less than $100,000 per year).

While I felt at the time that I was "forced" to take this sort of drastic move, in retrospect, I have to admit that it is the single best financial decision in my life. We got immediately out of debt, we were able to save like two crazed squirrels, and in four years, we were able to move back to Canada.

I could be retired now (I'm 49), but I choose to work because I like it. I continue to do work for US companies because of the pay relative to the paltry Canadian pay.

In the end, we possibly could have made it through our tough spot without having to take more drastic actions, but in the end, I am extremely happy that we chose not to just tighten the belt a little further, but to bring in more instead.

[alicia]

We're in the middle of paying down our debt that I accumulated during my nine years of schooling. Thankfully, it isn't a ridiculous amount, but it's large enough that it makes me uneasy. I grew up middle-class (parents paid off their last mortgage in five years on a $300k house 15 years ago), and had great role-models financially, but I wasn't TAUGHT how to do it. The funny thing is, my parents live well below their means, but I didn't learn it through osmosis... so, although I have an accountant for a father, when I finally moved out on my own, I spent willy-nilly because I had money in the bank.

I currently have a budget that works for us. Doesn't allow for a lot (read "any") extras, but it gets us out of debt in 18 months from now (before the debt fatigue sets in completely, hopefully) and we're able to save at the same time. A realistic budget works for us. There are a lot of coupon pros on this website, but I am not one of them - I dabble. Don't get me wrong, I got the free Resolve, or super cheap Barilla, or whatever the deal of the time was, but I learned I have to be selective. I write my list and stick to it. Fruit and veggies for the week are whatever is on sale, and the freezer is stocked with meat from when it was cheapest. I found we do a lot better just following a list very closely than trying to match coupon deals. We spend less, and we eat better.

I am a big fan of seeing the progress in numbers form. If you're okay at formulae in Excel, you could make a Net Worth calculator that you can forecast forward to see the number get less negative, and/or (eventually) positive. I am also saving at the same time (RRSP-match (7.5%) from the company, can't turn that down even if I am trying to pay back debt), but I can tell you exactly how much I will be worth at which month, and how much longer I have before my debt is gone. It is also important, that if you have consumer debt that you stop using your cards. I don't care if you get points, once you carry a balance you end up paying interest on the purchase the day you buy something rather than the 21 day grace period. It's also much easier to keep track of if your balance is just going down instead of bouncing up and down.

Because we're in bare-necessity mode for the next little bit, I try to maximize what "extras" I can get that I don't have to take out of the budget. For example, I redeemed Aeroplan points last week for a $50 Esso gas card (meaning I have to spend $50 less out of my cash flow than before, which can either go to debt, savings or an entertainment splurge). Or I did a focus group for 10 minutes for $25. Or use Air Miles to get movie passes. Or when I am playing on the computer while watching tv I do swagbucks. This way I don't feel guilty but I am not cutting into my rigid budget.

I think the other thing to keep in mind is that - things come up. My car maintenance fund ($75/month) is sitting at about $20 right now because I had to get a whole bunch of little purchases (like a new antennae, a new wind-shield wiper, and extra oil). And I know I need an MVI, new brake pads/routers and an oil change in the next two months. So I am going to go over and be paying myself back for a month or two, but it's much better to be dipping into my slush fund instead of my credit cards.

[marstec]

We bought a house at the right time and managed to pay a 25 year mortgage off in less than 12. We paid weekly, which was 52 payments per year. And when we renewed, even though rates had dropped, we kept paying our old rate. Made quick work of the mortgage even though it was a struggle at times.

We live a fairly frugal lifestyle - I do buy the best I can afford when it comes to big ticket items. Imo, you have to replace less frequently than if you bought disposable crap. I don't coupon all that much but I do take advantage of sales and clearances to stock up.

People that have money usually don't announce it to the world...you'd be surprised at how many folks are up to their eyeballs in debt who wear flashy designer wear, drive fancy cars, and live in mansions.

One thing I'd like to add is getting a good education (and a good job) is one of the most important things you can do for yourself - it's a much easier to have one job that pays well than two or three menial ones.

Saving is important, but that isn't the only thing...you need to enjoy some of your hard earned money too.

[Retiree]

When we had a mortgage on our first home, in the early '70s, we had and almost unheard of privilege clause that enabled us to pay $500 off the principle, once a year. We paid our 9.25% mortgage once a month and struggled to save that $500 but we did it and applied it to our mortgage annually. That and steady modest saving enabled us to pay off the mortgage in 10 years.
bought our second house, in the late 90s, we had a privilege clause that enabled us to pay up to 10% off the principle in any given year and in any amounts we could get together. We paid our mortgage 6.5% weekly, and again, we saved modestly but regularly. Every time we added $500 to our savings we would skim off $250 and apply it to the principle on our mortgage. This approach, and our modest saving, enabled us to pay off our mortgage in 12 years.

For over 40 years we have had 1 credit card. We have never paid a cent of interest on it. There have been times when it was a struggle to pay it off in the month but we always did so that we have been able to retire debt-free, which really helps since we are now on fixed incomes.

I do agree with Marstec. Saving is important but you do have to find ways to enjoy what you earn. Otherwise, you end up feeling deprived. Even spending your earnings modestly helps you enjoy the fruits of your labours.

[momof5boys]

Even if kids have parents that are good role models financially, they will or will not follow their example regardless. Kids who really are committed to saving, will save and others just spend whatever comes in. I know because we have both types. Once your kids are out on their own they just have to learn from their own mistakes and parents should not be there to bail them out either.

I tell our boys that my hubby and I are so thankful to have lived frugally and to have paid off our mortgage early because, in the economic downturn my hubby lost his job and was hired on with another company for half the salary. But we easily make ends meet, even though we are considered 'poor' by government standards. So, people, save save save if your income is good and you won't be sweating when times get tough. For us, gratitude for what we have, not caring less about the Joneses so we are able to contribute to others in true poverty makes for a content life indeed!

We're in the middle of paying down our debt that I accumulated during my nine years of schooling. Thankfully, it isn't a ridiculous amount, but it's large enough that it makes me uneasy. I grew up middle-class (parents paid off their last mortgage in five years on a $300k house 15 years ago), and had great role-models financially, but I wasn't TAUGHT how to do it. The funny thing is, my parents live well below their means, but I didn't learn it through osmosis... so, although I have an accountant for a father, when I finally moved out on my own, I spent willy-nilly because I had money in the bank.

I currently have a budget that works for us. Doesn't allow for a lot (read "any") extras, but it gets us out of debt in 18 months from now (before the debt fatigue sets in completely, hopefully) and we're able to save at the same time. A realistic budget works for us. There are a lot of coupon pros on this website, but I am not one of them - I dabble. Don't get me wrong, I got the free Resolve, or super cheap Barilla, or whatever the deal of the time was, but I learned I have to be selective. I write my list and stick to it. Fruit and veggies for the week are whatever is on sale, and the freezer is stocked with meat from when it was cheapest. I found we do a lot better just following a list very closely than trying to match coupon deals. We spend less, and we eat better.

I am a big fan of seeing the progress in numbers form. If you're okay at formulae in Excel, you could make a Net Worth calculator that you can forecast forward to see the number get less negative, and/or (eventually) positive. I am also saving at the same time (RRSP-match (7.5%) from the company, can't turn that down even if I am trying to pay back debt), but I can tell you exactly how much I will be worth at which month, and how much longer I have before my debt is gone. It is also important, that if you have consumer debt that you stop using your cards. I don't care if you get points, once you carry a balance you end up paying interest on the purchase the day you buy something rather than the 21 day grace period. It's also much easier to keep track of if your balance is just going down instead of bouncing up and down.

Because we're in bare-necessity mode for the next little bit, I try to maximize what "extras" I can get that I don't have to take out of the budget. For example, I redeemed Aeroplan points last week for a $50 Esso gas card (meaning I have to spend $50 less out of my cash flow than before, which can either go to debt, savings or an entertainment splurge). Or I did a focus group for 10 minutes for $25. Or use Air Miles to get movie passes. Or when I am playing on the computer while watching tv I do swagbucks. This way I don't feel guilty but I am not cutting into my rigid budget.

I think the other thing to keep in mind is that - things come up. My car maintenance fund ($75/month) is sitting at about $20 right now because I had to get a whole bunch of little purchases (like a new antennae, a new wind-shield wiper, and extra oil). And I know I need an MVI, new brake pads/routers and an oil change in the next two months. So I am going to go over and be paying myself back for a month or two, but it's much better to be dipping into my slush fund instead of my credit cards.

[alicia]

Even if kids have parents that are good role models financially, they will or will not follow their example regardless. Kids who really are committed to saving, will save and others just spend whatever comes in. I know because we have both types. Once your kids are out on their own they just have to learn from their own mistakes and parents should not be there to bail them out either

I am not sure I completely agree, at least in my case. I worked from the age of 16 (before that I babysat from 12 on) and I left my parents house with tens of thousands in savings. I got into trouble because I didn't have a realistic understanding of finances/costs (the shock of being on your own) and how to monitor the balances. Since I had such a large savings it never "required" me to budget because I just saved myself with my savings. I think if I just understood how to properly budget, which is a pretty easy lesson, it could have gone a long ways. Not trying to place blame, but rather something I think could have been very beneficial.

[vesper]

I own 2 cars, both used, both paid for in cash. After taxes, it is my opinion you should have money left over each month, or your spending to much. Folks buy the most expsnsive house then afford, why not take a less expensive one?