Resolutions

Judith's comments got me thinking. Of course the first thing I thought was, how cool someone's actually reading this besides my hubby! Once I got beyond that,and it did take a while:-), I began thinking about the resolutions she listed, specifically paying off all consumer debt, excluding mortgages, in 2005. I like that one and its one of my goals as well.

Sometimes things just click in your head. This time last year I discovered the Complete Tightwad Gazette. We'd always been on the frugal side but extra money after bills meant you had extra money for spending. Sound familar to anyone? Something clicked when I read that book and it pushed me to re-examine our spending style. Small changes here and there through the year really helped us avert what I think would have been financial disaster not to mention it would have greatly reduced our chances of retiring early.

What do I mean by financial disaster? Well let me first that my definition of financial disaster may be very different than someone elses. We were/are in no danger of losing a home, a car or having services discontinued (ie lights, phone etc). In fact, our bills were/are all still being paid, we still have credit cards with lots of available credit (I have begun to think of credit card companies as the devil's foot soldiers but that's for another post) and I've never had a creditor call the house in search of missing/late payments. For me financial disaster meant spending in excess of what we make on a regular basis and digging ourselves into a hole of interest charges. It meant having to do overtime to keep up but not being able to enjoy any of the extra money. It meant that unplanned expenses really could mess up my financial world. I prefer to have a cash cushion, as you never know what expenses might pop up. (Like two days ago, when my hubby did some body work on his car in the snowstorm.)

So if I'm so brilliant, how did I end up with any consumer debt? Easy, because furnaces need to be replaced, tires wear out, roofs leak and dinner out after a long day is easier. And none of these things are required to happen when you have "extra money" lying around. Also, its so much easier to slide your credit card through the card reader at the gas pump than to go inside and pay cash, especially if you've got kids.

Why is 2005 the year I'll be able to make it all go away? Because knowledge is power and I spent much of 2004 gaining and implenting new knowledge on how to live more frugally. I begin 2005 with no charges for Christmas shopping. It was cash, freecycle or handmade this Christmas. We've changed our buying habits dramatically, we really think about purchases. Do we NEED this item? If we do need it, can we borrow it? Can we get it used? Can I borrow that book/video from the library?

I also look at finite expenses differently. The preschool tuition that I will be done paying in April is not extra money, its money to use towards other bills that need to be paid down.

I always tell my kids you never stop learning, even when you're an adult.