My motto for 2013, as you likely know/may have guessed is “Flat Abs, Fat Wallet” and so far, I’ve been really focused on the exercise portion of the Flat Abs, but don’t have my food under control, and I hadn’t done a damn thing about the Fat Wallet part. Until today.
It all boils down to self-control. Actually, what it all boils down to is a lack of self-control — in my financial life AND in my kitchen. I got fat because I didn’t control what I put in my face and I got into debt/am always broke because I don’t control my spending. Well NO MORE OF THAT. I am done with my old ways, and I’m deadly serious about it.
Self-control is the ability to control one’s emotions, behavior, and desires in order to obtain some reward, or avoid some punishment.
Here are the changes I’m making to my life to take control of the situation:
1. I am eliminating overdraft.
When I first opened my account with my credit union, they convinced me to take a $500 overdraft. “You don’t have to use it” they said. “It’ll just be there for emergencies” they said. They obviously didn’t know that I can justify eating Subway for lunch 3 days/week as an “emergency”. I got myself into this vicious cycle of using the entire $500 every paycheque. Read that again: every. paycheque.
It wasn’t always intentional, and believe me: Every single pay period, I would tell myself “I’m not going to use my overdraft”. And every single pay period, I would manage to get into a situation where I “needed” to use it and then *shrug* well, I was already into it, so….
I am shaking my head at myself as I write this, because it’s just so ludicrous. Every paycheque reduced by $500 means that I would just have to use the overdraft again. Catch 22, right? Right.
As of tomorrow morning when I get paid, I will no longer have overdraft. My current overdraft balance of $470.09 will be paid off and then the credit union is removing the overdraft from my account.
I am going to have to learn to do without. If the money isn’t there, it isn’t there and tough bananas for me if I didn’t budget properly. (Oh, and, if the bananas are tough, then they’re going to have to ripen on the counter for a bit because that shit will give you cramps <— true story)
The reward: Starting a pay period with the actual funds that are deposited into my account.
2. I am applying for a term loan to pay off my credit card.
Now, you might be thinking “you’re getting into more debt to pay off your debt”? But, again, please believe when I say this is a good move. If you don’t know much about debt consolidation, the #1 thing to know is: Less interest to pay = balance paid off sooner.
Because I was going into overdraft on every cheque and starting each pay period in a defecit (“in the hole”, so to speak), I was finding it difficult to pay any significant amount on my credit card each month. I had maxed out that card a long time ago and have been paying interest on the $3500 balance for far too long. Most credit cards have an interest rate of 18-24%. Mine is 24%. That means that each year I am paying AT LEAST $850 in interest (except credit card companies also accrue interest daily, with varying rates based on interest and principal paid down, blah blah blah blah blah blah BLAH). The long and short of it is that I was paying too much.
My term loan will pay off the balance of my credit card, is only a 2 year loan, and is at a MUCH more manageable rate (somewhere around 9%). I can pay as much off as I want at a time, so if I have extra money, I can always put down more on the principal.
Then, I’m going to freeze my credit card (literally — in the freezer, in a tupperware container) so that it’s a major effort if I have to use it.
The reward(s): Having a credit card with a $0 balance that can actually be used for emergencies; paying less money to debt owed; actually having money I can use for savings!
3. I am planning my meals for one week at a time
“How is this part of a healthy financial future” you ask? I’ll tell you! Meal planning is a two-fold reward:
A) Spend an amount on food that is realistic and works within my budget, and
B) Plan meals that are healthy and satisfying that will help me reach the Flat Abs goal!
This is something I have been working on for more than a year now. It is TOUGH, but I know the results come every. single. time. I do it, so I am just going to do it. All I have to do is take control of myself. Therein lies the key: Take control. Of myself.
This is not the first time I have done debt consolidation, but man, would I love for it to be my last. I have very little debt and would like to live debt free with a bunch of money in savings, and I want to be around to enjoy it, so I have to continue to focus on the health portion of things.
I’d tell you to wish me luck, but I think, for the first time in my life, I have figure out that I am going to have to work for this, dammit. WISH ME LUCK! ;)