Debt-free without the deprivation - From Rags to Reasonable

*The following is part 2 of a year-long series. If you want to start from the beginning, learn about who Lindsay is and check out how much debt she’s starting with…  check out PART 1.

Alright my friends! The first month of my debt-paying challenge is over, and let me tell you, it’s been a roller coaster.

Like the start of any good financial challenge, it began by my going on a 4-day juice cleanse, and taking a purely personal trip to New York City for my birthday.

Wait… what?!

Ok, so I didn’t get off to the best start. These were things that I had budgeted for… (sort of…), but due to some silly errors I’d made and a bit of poor planning, they ended up costing me quite a bit more than I’d anticipated.

By the time I was a week and a half through the first month of my challenge, I’d put myself in a worse financial situation than I’d started with! Ugh!

There are a ton of things that came out of this, some of which I’ll talk about today, and some are big topics that I’ll try to catch up on later.

One HUGE thing is mindset and self-sabotage.

Another version of myself would have been like… “Well, you clearly failed at this month. Better to just ride it out the way you started and try again next month, because this one is clearly a write-off.”

I used to think that way ALL the time!

Luckily, from work I’ve done paying debt before and work I’ve been doing in my own personal life, I knew that I could pick up and change immediately from where I noticed the problem. I went into problem-solving mode and tried to figure out how I could make a recovery.

Another big thing is that when I looked back at how I’d spent all that money, I didn’t actually feel bad. I really valued going on that cleanse as a way to start off my 29th year, and my trip to New York was wonderful! I saw so many things I’d never seen before in the city, and got to spend time with a friend who was visiting from half-way across the world. I don’t ever think I should feel guilty when I spend money on things that I truly value.

I made some pretty big financial mistakes on my trip, don’t get me wrong, but the trip itself was important to me. I think we know deep down when we’re spending on things we value vs. when we’re just spending because we can.

On that note, (and one thing I’ll definitely come back to) deprivation mode has never been part of my plan. Some people work really well under a “I’m going to deprive myself of all that isn’t absolutely necessary for me until I’ve paid my debt” plan, and I am not one of those people. I’m not going to save up the enjoyment of my life for some unknown future date when I’m debt free and have x amount in savings.

I can still live while I’m paying debt.Debt-free without the deprivation - From Rags to Reasonable

So anyway. There I was, a week and a half in, wondering how I was going to make any headway on my debt payments this month. I started to think… I know that spending on things that I value is important to me… but where can I cut down on things that I don’t really value? And within the things I value, how can I narrow in on what I actually want vs. what I’ve made into spending habits?

Previously, I’d only really applied this mindset to “luxury items.” For example, I value going out for a beautiful meal with friends, but I don’t really value new clothes when I don’t need them, so I’m ok with spending money on dining out but not on clothes. This was a big first step for me once upon a time, and it made a big difference. This month, I learned to take it way further, and out of the “luxury item” or “splurge” realm. Where was I spending my money in day to day life in ways that I didn’t value?  And where was I allowing myself “luxuries” that I actually didn’t care about? And when I was spending on these luxuries, was it the experience that I enjoyed, or was it the product?

Here are just a few things that I actively changed:

  • There’s a grocery store like, 3 minutes from my house, and a much cheaper grocery store about 15 minutes from my house. I THOUGHT I valued the convenience of the closer one, but the walk up to the further one is nice, and I save money!
  • I had been in the bad habit of buying lunch every day with my boss – we’d get takeout from one of the countless food options around my day job. I realized that this actually did nothing for me! We still ate it in our tiny office. The food got boring. I was literally just wasting money without thinking about it. Instead of buying lunch, I’d bring lunch from home, and then allow myself a treat, like a cookie or a macaron, from one of the shops nearby.
  • I’ve been super into matcha lattes lately, and I used to pick them up every couple of days when I was out, or on my way to work. I realized it’s not the experience that I’m into, it’s the actual tasty matcha latte, so I started making them at work or at home instead.

It’s crazy how these thing add up! In the same vein, I have two investments that I’m looking to make along the same principals within the next month:

  • I’m going to buy out my cell phone plan and switch to a much cheaper month-to-month contract, because I realized the times I use the most data are times when I care the least – just wasting moments on transit or waiting in lines.
  • I’m going to invest in a bicycle, so I can bike around the city rather than spend time and money on transit.

So there you go! And how did I fair this month?

I paid off $780.16! That’s about 6% of my debt, and I’m now at a total of $11,592.79.

What luxuries do you allow yourself? Are you able to go into deprivation mode?

Debt free without the deprivation - From Rags to Reasonable

What happens next?? Lindsay dives into why she’s breaking all the normal debt rules in PART THREE!