There are three things in my life I’d like to reduce. I thought I’d blog my goals and maybe seeing them in black and white will help me stay motivated to reach them. Any insight you have on any of these topics would be greatly appreciated.

The three areas I want to work on are:

– debt reduction
– weight reduction
– clutter reduction

One of these things I just recently started tackling, and the progress is going very well. One of these things I have successfully accomplished in the past, but sadly I’m back where I started and need to start over again. The third is something that is a constant struggle for me and I’m just not even sure where to start.Today the topic is debt reduction. This is the one that I’ve recently become passionate about. We were living the wonderful American life. We had everything we wanted, plus some. We don’t have power boats or vintage cars or expensive jewelry, but that’s not us. Unfortunately, our problem was insidious and crept up on us without fanfare. Things seemed to be under control–after all, we always could afford the payments on things, even if it was just the minimum payments. Debt collectors were not calling or harassing us. We were never late paying a bill nor did we ever default on a loan. Which is what made me think that all was under control.And then I heard about Dave Ramsey. After reading his book “The Total Money Makeover,” I realized we were only one emergency away from financial hardship. Mike was bringing in a decent salary, yet we were living from one paycheck to the next. The 4-year loan on the car was going to be paid off in 4 years. The 15-year mortgage would take 15 years. Every once in awhile people need to consolidate their bills, right? That’s what we thought–twice. We accepted that as a fact of life. Then Dave Ramsey motivated and empowered me. Now I am passionate about hacking away at the debt as quickly as possible. I’m sick of OUR money benefitting other people. I want it to work for US!After reading Dave’s book, I immediately started saving up an emergency fund consisting of one thousand dollars stashed away in an ING Direct account*. Then we created a budget. We had been married 15 years and we had somehow managed to live without a budget. Now I’ll never live without one! We had to sit down and seriously scrutinize every category. And, because we were spending more than we were making, there had to be some cuts. We axed the online video game service. We scaled back on the number of audio-book downloads per month. We decreased our dining out budget by 70%! After several more cuts, we had numbers we could work with!

Luckily, we managed to made quick work of our credit card debts. This started the “debt snowball.” Once those cards were paid off, we used what we had been paying on them to pay something else. Next up to get paid off was the Disney Vacation Club** loan. The way Mike’s office works, about 2-3 times a year he is required to take out the surplus in his account. The extra happened to be just about enough to pay off that loan! The ironic thing is, if it hadn’t been for the budget, that extra money would have gone to pay off the credit cards (which invariably by that point would have had high balances again). The money could now be put to better use.

The snowball continued. Now instead of paying MBNA and Bank of America and Disney Vacation Club, all of THOSE monies got thrown at the student loans. As things get paid off, the snowball gets bigger, the payments get bigger, the principal balances get smaller. This is what motivates me to keep finding creative ways to make money or to save money. I’ve sold some things on ebay to bring in a little more income, and I’ve started playing the Grocery Game*** to save about 50% on my groceries. The more I save and throw at the debt, the more my motivation skyrockets.

I have gotten great encouragement from various sources. From websites, to podcasts, to books. Some that have been the most helpful are the following: Dave Ramsey’s website, book, and podcast, No Credit Needed Blog and No Credit Needed Podcast, and the Creating Wealth on Your Current Income Podcast. Check them out!!

So this is the one area where I’m doing well. I am on a roll and am super motivated to continue in this way. I can see the light at the end of the tunnel. It’s still quite a distance away, but I can see the dim glow. If you’ve found any great websites or helpful tools, please leave a comment. If you’d like some encouragement, also feel free to leave a comment. I am debt reduction’s biggest cheerleader now!

*ING Direct is an online savings account which currently is paying 4.5% interest. It’s safe, secure, and a good way to stash a bit of money that, if kept in the regular checking account, is likely to be spent. ING Direct has a referral system in place. If you are interested, please email me and I can refer you!

**Disney Vacation Club is a pre-paid vacation time share. As our number one vacation spot is Walt Disney World, this works great for us! Disney Vacation Club works on a referral basis, so if you’re interested in information, please contact me!

***Grocery Game is an online service that helps you save money on your grocery budget. For a small fee, a “Listmaker” prepares a list for your area matching up current sales to circulating coupons. The result is getting groceries at rock bottom prices. Considering one day I bought $63 worth of items and paid $0.42 for them, I’d say it works. Grocery Game also works on a referral basis, so if you are interested, please email me and I’d be happy to refer you. They do have a 4-week trial for $1 so it doesn’t cost much to check it out.

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