Yesterday I left you hanging, promising you a “what’s next” post. If you didn’t read yesterday’s Why Are You Frugal then go back and read that before continuing on, please. 
Also, if you didn’t have a chance to check out the comments on that post you might want to take a minute to do that too. There were some really great ones.
For those of us who are frugal because we have to be, here is what I think is next.
Create a surplus
I know what you’re thinking, “I’m BARELY making it! You want me to have EXTRA?” Yes. It doesn’t have to be a ton of extra, just something. There is no “what’s next” if there is not a surplus. Can you find $10/week? That’s a good place to start.
You aren’t ever going to have the choice of being a “want to be” if you don’t get out of maintenance mode – scraping by, barely making ends meet. If all you are doing is maintaining the same level of financial nervousness then your what’s next is going to be downhill. You want things to get better, right? Create a surplus.
Right now, we’re trying to sell our camper. We love camping. We love our camper but we want to increase our surplus each month. Could you sell something that has a payment on it? A tractor, four-wheeler, snowmobile, second car – it can be done. If you get rid of a payment, you’ve made a surplus.
Assuming you’re already living a frugal life, then you know the power of careful spending. Is there anywhere else you could spend just $5 less? Could you travel less or carpool? That could save on gas. Now, with that money saved – don’t absorb it into your grocery budget. It’s part of your surplus.
Save the surplus
When your budget it tight and you are stretching your money as far as it can possibly go it is SO easy to absorb that surplus into another area that needs it. In fact, that’s what many people do. Oh good, I spent $10 less on that shirt than I expected, now I can get those shoes.” We spend the money we “saved.” Our mindset needs to change. We are spending less so that things can get better, not so we can spend more on something else. For more on this whole idea read Money Stretched Vs. Money Saved.
The purpose for saving your surplus is so that you have an emergency fund in place. You need to have a back up savings. If your furnace dies you need to have money available to fix it. Having an emergency fund will keep you afloat. You won’t have to dip into your budget or choose something to not get paid in order to resolve your “emergency.”
Kill the debt
I’m sure there’s a nicer way to say that but I like how harsh it sounds. The debt is the reason you’re in trouble. Your groceries, heating oil, electricity and cable, while they consume a lot of money, they aren’t the reason you “have to be” frugal. It’s because you owe money for things. Once you have emergency money set aside, begin tackling your debt. It doesn’t really matter how you do it. We are going the snowball route. Do what works for you. I am not a financial advisor, nor should I be (at least not until I have some financial success under my belt). We’re using the debt snowball because it yields early success and quick results, which are motivating.
This is the step that makes being frugal worth your while. When your debt begins to go down as a result of your mindful spending, careful saving and diligent debt-tackling, it makes it feel like it’s all been worth it. As your debt-load lessens you may find suddenly one day that you’re being frugal just because you want to be and not because you have to be.
I can’t write a post on eliminating debt without referring you to Dave Ramsey’s Total Money Makeover
This is where I am. I can only speak from my experience and so far this is working for us. Are you on the other side? Have you been through all of this or are you just starting out? I’d love to hear your thoughts. What’s working for you or what are you struggling with?
Why I do what I do ~ Last night when David got home I prompted Chloe saying, “What’s the great choice that you made all day today?” She said, “The great choice is not to have any accidents. I only had 49 accidents Daddy.” I was in the kitchen working on supper and blurted out a loud laugh, the kind that would cause food to explode from your mouth across the room. Not only did she not have any accidents but …. 49?????? Where did that come from?
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{ 5 comments… read them below or add one }
I’m frugal because of the way it makes me feel. I like the freedom and the control of no debt. I wasn’t always like this so I’m a reformed spender. I’m always looking for new ways to save and people with similar points of view. I really like this website for those reasons. I’m a recently retired teacher and I’d like to hear about what retirees are doing in addition to young women with families.
We are working on becoming debt free. After paying off a car one year early and getting very excited, our income dropped. We are not discourged, just thankful that we now have one less payment to worry about. We still snowball as much as we can, but our plan to be debt free sooner, will happen later. We want to feel the freedom to be a debtor to no man.
Why am I frugal? I ‘have to’ be frugal if I ‘want to’ live the way I live. I LOVE being debt free and only having to work part time ’cause there are SO many other things I like and want to do. Being home for my kids, gardening, quilting, and being FREE rather than tied down to a full time job, never having time to do anything I want, and being behind in EVERYTHING. That’s the way I used to live and of course once I had kids it was even harder to keep up with all the events of everyday life. I hope I never have to go back to that. I wouldn’t trade this for anything. I’m so blessed to be home for my kids when they get out of school and home when they are on vacations and summer break. I’m especially aware of that at this time of year when I hear parents (and kids) saying they don’t know what they’re going to do this summer or where they’ll go. It’s so sad. I am so thankful. So thankful!!
oops. My previous post was for yesterdays topic. I put it in the wrong place, sorry! So here’s my 2 cents on what’s next. As someone who is “on the other side” as you say. All I can say is “Go Without”. I know that sounds negative but no pain no gain. We Americans have more everything than we need. When we started out, we made a budget, opened a separate checking account, put the “house” money (which actually was ALL of our expenses but I just called it house money) in there and when the bills came, the money was there and the checks went out. But anyway when we put it all down on paper we “cut” everything we could cut. I mean EVERYTHING. Cable? We don’t “need” that, get rid of it. The phone bill is what? Get a cheaper plan and stop calling long distance so much. The power bill is too high! Get rid of that extra freezer, stop using the dryer, unplug the electonics, don’t watch so much tv, grill more, shut the lights off! Car insurance is outrageous. Call and get a cheaper rate, put liability only on it if it’s paid for. Groceries are killing us!! Buy in bulk, cook more from scratch, no more convenience foods, no more steaks, no more eating out, make a menu – make a list, don’t throw anything away. I stopped buying my clothes at JC Penney and used what I had, which was plenty. I stopped going to Walmart, I used to go to Wal-Mart once or twice a week. I didn’t need all that stuff, once I stopped going I spent a LOT less money and I still lived
. If you don’t shop, you don’t see, and if you don’t see, you don’t want. Yah it’s hard, it’s a big adjustment. So anyway, when the paycheck came, the amount we’d figured for the budget was deposited and everything else was saved. Everything! Bottom line is you have to go without. It doesn’t have to be that hard FOREVER but it has to be that hard at first. It’s worth it when you get to the other side.
Great article … sharing with my readers!! This is linked on my “This ‘n That” Thursday post.
http://myreasonstoblog.blogspot.com/
Love your blog!!
~ Joy
Joy´s last blog ..This ‘N That Thursday