Debt Free Destiny

Bankrate.com recently reported a story about a few families who limited all non-bill expenses to $250 for the month of July (including groceries, gasoline – everything that wasn't a monthly required payment like the mortgage, had to be kept under $250 for the month).  The family allocated 25% of their income to paying off debt and saving money typically – but during the 30 day no-spend challenge they put upon themselves, they were able to increase their debt payments and saving to 40% of their income.

How is this possible?  Seems that spending can be reduced even further than you think with conscious effort.  Most families would never be able to sustain such a tight budget long term – but for 30 days, the challenge could be seen as fun!  See how much you can save on a 30 day no-spending challenge for your own family – and apply the money you save to your debts or fund your emergency account.  Figure out what your absolute required expenses and bills are – this list should include loans, credit card payments, mortgage or rent, and utilities.  Anything that does not have a fixed payment is “extra” in this experiment.  Give yourself a cash budget for the “extras” - groceries, gas, entertainment, etc – and then stick to it for a full 30 days.

Does it seem impossible? 

First of all, most families have a freezer, kitchen cabinets and/or a pantry that has quite a bit of usable food items in them.  We tend to go grocery shopping weekly or every other week to get our fresh produce and dairy items – and always buy additional boxed, canned and frozen goods.  Chances are you could plan your meals around what you already have and spend far less on groceries for several weeks at a time.  If you are going to embark on your own 30 day challenge, reduce your food cost by determining what you have already and what sort of meals you can create with them.  The meals may not be what you're used to eating, but that's not necessarily a bad thing! Variety keeps it interesting.  Try to go an entire month just buying a few dairy items and produce (if you don't have frozen or canned varieties already), and if you do buy meats to supplement what you have on hand, try to buy family packs that can be used for multiple meals.

Instead of paper towels, you can use washable rags.  Keep a roll of paper towels for things you absolutely cannot use a washable rag for – but if you keep a basket of rags ready to go in your kitchen, chances are you can use them instead of paper towels for most kitchen messes, and for drying hands.

Since you won't be spending money on entertainment or running back and forth to the store, chances are you won't be driving as much and you'll save gas money.

At the end of the 30 days, if you managed to keep to your challenge, you should have quite a bit of extra money that can then be used to pay a debt or boost your savings account.