Pay Off Debt in 7 Steps and Still Maintain Your Lifestyle

Nov 06 2013

by Tiffany “The Budgetnista” Aliche

Hey Millennials!

By show of hands, how many of you want to pay off debt? That many huh? No worries, so do I and so does just about everyone you know.

Unfortunately, debt is a way of life for many. I didn’t want that to be my life, so I created a 7-step, pay off debt system that will have me debt free in a few years!

My pay off debt system is working so well for me, that I had to extend my financial help to my Sis-Stars. :)

Ready? Set? Let’s pay off debt…

Step 1) Create your Money List aka a quick budget. Before you can dig your way out of debt, you need to know where you currently stand financially. This process should take you no more than 30 minutes.
(Need financial help with step 1? Use Day 1 of my bestselling book, The One Week Budget, to get you up and running… don’t worry, it’s FREE—>  http://bit.ly/13GARhc)

Step 2) List all of your debt from lowest to highest.
FYI: You might need a box of tissues handy. Looking at your debt can be a bit depressing, but cheer-up chuck. You’re only 5 steps away from getting your situation under control.

Step 3) Figure out how much money you can squeeze from your Money List, for your pay off debt plan. Good news Boo! There’s no need to change your lifestyle. There are ways to free-up cash, without making dramatic changes to the way you live.

First, I suggest doing things like: reduce your cable (ask your provider to get rid of the channels you don’t watch), cancel magazine subscriptions (ehm…the library), cancel a gym membership (come on, you’re not using it), and call your service providers and ask for discounts (i.e.: car insurance, cell, utilities). This works! If they claim they can’t help you, use the magic words, “Can you please transfer me to your Retention Department?”. There’s always a deal to be made. :)

Reminder: Make sure to keep some of what you save for saving. Paying down debt and savings should always happen simultaneously.

Step 4) Pay only the minimum amount required on all of your debt, with the exception of the one debt you are trying to pay off. This should be the debt with the lowest amount owed. I suggest paying the lowest debt off first vs. the debt with the highest interest rate, because when you pay off debt quickly, having early success will trigger an emotional reaction from you (happy-dancing), and that will enable you to feel encouraged and will motivate you to continue with your pay off debt plan.

Step 5) Pay the minimum and the money you squeezed from your Money List (step 3) for debt reduction, toward the first (lowest) debt on your list. Make sure to automate the payments. This will leave you with less work and tallying to do each month. Remember to reset your automation when you move on to the next debt on your list.

Step 6) After paying off the first debt, apply ALL of the money you used each month to pay off debt #1 and put it towards the next debt on your list. This means that the minimum amount from the first debt, the minimum from the second and the extra money that you found in your Money List, will be applied toward the second debt on your list. Don’t forget; automate this new payment; doing so will help you stick to your pay off debt plan. Haven’t you heard? Automation is the new discipline.

Step 7) Pay off debt #2, then transfer ALL of the money you were paying each month to the second debt and apply it towards the third debt, along with its minimum. This means the third debt will be getting: the first debt’s minimum, the second debt’s minimum, its own minimum, plus the extra money you found in your Money List. Once again…AUTOMATE this new payment and continue with the cycle until you’re debt free!

The AWESOME thing about this pay off debt plan is that, as you begin to pay off debt with higher balances, you’ll have larger amounts of money to pay them. The reason is, you’ll have “collected” all of the minimums from the previous lower debts, and will be using them along with the money found in your Money List to pay the higher debts off.

A little extra financial help: After using this pay off debt system, continue to make “payments” to yourself and finance your savings, retirement and investment goals. BOOM! :)

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SIDEBAR: Give your pay off debt plan a Turbo Boost!

Use UM (Unexpected Money) to help pay off the main debt you‘re focused on. UM is any money received outside of your primary source of income, a.k.a. your J-O-B.

Examples of “Unexpected Money” are: a raise, loan repayment (to you), a refund (from taxes or from returning unwanted items), rebates (do you fill out and mail in those forms? I do!), found money, gifted money (happy birthday!). If you purchase an item that is on sale but don’t realize it until you get to the cashier, the money you save is “Unexpected Money”. You already planned to spend the money on the item, so you won’t miss it if you use it for your debt reduction instead. If you have generous friends who occasionally surprise and treat you by paying for your meal, the money you were going to pay is also Unexpected Money. Cha-ching! Are you starting to see the possibilities here?

In a nutshell, “Unexpected Money” or UM, is any money that you did not expect to receive or save. It’s money that does not normally contribute to your day-to-day living expenses. So, it’s therefore not calculated into your Money List you now have. You do have a new Money List, right? (step 1)

The best way to use UM is immediately. As soon as you encounter UM, go online and make an additional bill payment in the amount of the UM, to the lowest debt you’re working on. There is no amount too small and it really adds up!
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Soooo, now that you’ve got your pay off debt plan in place, do you feel a little better?

Questions? Thoughts? Please share them nicely with me in the comments below. :)

About the author: Tiffany “The Budgetnista” Aliche is a speaker and a passionate, award winning teacher of fun, financial empowerment. She is also the best selling author of the book, The One Week Budget (#1 Amazon / budgeting). Her company, The Budgetnista, specializes in the delivery of financial literacy education.

Tiffany is the financial literacy expert for City National Bank, and she and her financial advice have been featured on the TODAY show, Pix11 Morning News, News 12 New Jersey, ESSENCE Magazine, FORBES.com, The Star Ledger, Ebony Magazine, FoxBusiness.com, MSNBC.com, Redbook, CBS MoneyWatch.com, Black Enterprise, USA TODAY, VIBE.com, as well as numerous online publications. She also blogs about personal finance, for The Huffington Post.

You can learn more about Tiffany and The Budgetnista here: thebudgetnista.com.

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FINANCIALLY PREPARING FOR THE HOLIDAYS

Nov 04 2013

By Xavier Epps.

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This blog post is written by one of our panelists for our chat on November 19th. Xavier Epps.  To learn more about Xavier and his accomplishments, head over to his website – xnefinance.com.
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Today, the holidays are approaching fast, before you know it, the holidays will be here so it’s a great time to begin implementing tactics that will help you financially prepare for the holiday season. If you haven’t begun setting aside cash for the holidays, don’t panic, but be weary that some personal sacrifices may have to take place in order to be prepared.

Make a list of the absolute necessities within the household budget for the month (mainly bills, groceries, transportation, rent/mortgage and minimum payments to debts outstanding). Retrieve you last month’s bank statement and add up all the debits you see, compare the total number debits from your bank statement with the basic necessity list created, and is the number larger from the bank statement versus the list you created? If so, let’s work to cut some cost throughout the list that will allow you to put more cash aside for the holidays.

If you feel propelled to take on any form of new debts for the holiday season, please don’t.

If you’re contributing to a retirement plan currently, consider lowering how much your contributing over the next three paychecks to save more money (while this will alter your tax liability slightly for the end of the year, it won’t be as costly as new debt). Consider working overtime, finding a part-time gig, selling fairly used items that you have no need for, just do what you have to do to avoid going taking additional debt in exchange for happy faces during the holidays.

photo credit to http://onlinebusiness.volusion.com/

photo credit to http://onlinebusiness.volusion.com/

Next, compose an “I Want Everything” shopping list for the holidays, then slash the list by 50 per cent (keep the slashed portion of the list for next year birthdays and holidays). The finalized is now finished, implement a plan to begin purchasing, for the rare items that sell fast, consider putting them on layaway soon. Add the layaway items to budget list created earlier and be mindful of date required by the retailer to pay off the item in order to obtain them in time. For items that you consider expensive, don’t rush to place them on layaway, we have Black Friday (in-store and online retailers) taking place on November 23rd (it has been rumored that major retailers may have a post-Black Friday sale in order to capture more market share before the actual day) and Cyber Monday (on-line retailers) on November 26th. Check out what’s being offered on these days for the expensive items on your shopping list to save some money versus placing them on layaway. In 2011, consumers spent $52.5 billion during Black Friday and $1.3 billion during Cyber Monday, so be ready to grab some stellar deals.

Xavier Epps
Financial Advisor & President
XNE Financial Advising, LLC
14412 Brandon Court, Woodbridge VA 22193
202.841.4713 Cell 703.563.9272 Fax xepps@xnefinance.com www.xnefinance.com

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Millennials and Mental Health Transcript

Oct 28 2013

by Willie.

Such a great, great chat last week.  Thanks to all who joined in.  One tool that we love to use is Tweetchat DURING the chat, and one in particular that I love to use AFTER is Storify.

Check out the transcript from last week’s chat. Also, don’t forget…

MARK YOUR CALENDARS – tomorrow from 1-2pm EST, we will be brainstorming ways to raise awareness and start conversations with those in our generation about the importance of talking about mental health issues. 

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Chat Preview: Millennials & Mental Health

Oct 21 2013

by Willie

Happy Monday chatters!  We are a day away from getting back into full swing for Millennial Chat.

I am very happy to have Partners for Mental Health and the women of MillennialMentalHealth.org.  I wanted to provide the list of questions for everyone to be well prepared for tomorrow.

Any suggestions on these, please leave a comment below.

Q1: If you could include a definition for Mental Health in the dictionary what would it be?

Q2: What do you think are the general misconceptions millennials’ have about mental health and

illness?

Q3: How has this differed from prior generations?

Q4: What are the most prevalent mental health issues for our millennial generation? Whyare these so

prevalent?

Q5: How can someone our age begin a proper conversation about mental health and illness?

Q6: What is an appropriate way to get help for a friend whom we suspect may be suffering from mental

illness?

Q7: What are the best resources out there for us to share with our friends and family?

Q8: If you feel like you are suffering from mental illness what is a good way to get people to listen to you

who may be brushing you off?

 

See you tomorrow at 1-2pm EST. Meet us on Twitter using the hashtag – #millennialchat.

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Topic Discussion with Heidi Oran

Oct 15 2013

guest post by Heidi Oran – Co-Founder of MillennialMentalHealth.com.

October is Mental Illness Awareness Month – an important time to both raise awareness about mental illness and explore the most prevalent cause of non-accidental death within our generation: suicide. There are approximately 95 million Millennials in North America, and though we’re often lumped together in one group, attempting to place our entire generation into a single category would be both unfair and inaccurate in terms of contributing factors – these factors are as diverse as Millennials ourselves. And while the most recent data available from the Center for Disease Control from 2010 states that suicide within the 15-34 age group has been on a decline since the 1990′s, recent studies about our generation tell a different story. The tale of a large majority of Millennials today is one that is laden with anxiety and uncertainty, laid upon a cracked foundation with a common thread weaving each story together – the breakdown and malfunction of many of our social and cultural institutions.

While it may seem odd to the question of our institutional roles into the suicide equation, I’ve come to realize that the external factors which are the stepping stone to mental illness are critical to understand. With this knowledge we can raise awareness and take individual responsibility for our participation in the bigger picture moving forward. We know that the issue of suicide is complex across all generations, but Millennials have a different relationship with the world than those who came before, and our place within our institutions look much different.

This past February a study was released confirming what Millennials already knew – that compared to other generations, we are the most stressed out cohort. The mounds of debt post-College and the impossible job market are just a couple of examples of how our educational and financial institutions are failing us. The academic pressure begins at young age and has become so common that College websites have began to feature helpful tips on how to help you cope. Whether Baby Boomers and members of Generation X like it or not, the truth is that Millennials have been promised a world that doesn’t exist, and many of us are ill-prepared for this reality. Stress has been proven to lead to anxiety and depression – identifiable mental illnesses and factors which can then lead to suicide.

But this is just the tip of the iceberg.

While researching this story, I learned that there has been a dramatic increase in suicides within the military – and a recent report showed that nearly 60% of failed attempts were by men under 25. While there has always been a difficult period of transition for members of the military as they begin duty, there has been a new shift in military culture that Millennials are walking into. The community military bases are no longer the safe-havens they once were and now drug and substance abuse is on the rise. Add this to the post-traumatic stress disorder that is commonly suffered by those who participated in active duty and the stigma which the Military admits they have had no success in diminishing, and you have a dangerous cocktail of factors which, if left undiagnosed, could lead to suicide. A slippery slope that can, in the best case, lead someone to counseling – but they will have to get in line.

Another group that slides under the radar in the news are Native American and Alaska Native Millennials – a group whose rate of suicide is 70% higher than other American youth. According to an American Psychological Association report, this group slips “through the cracks of a broken medical system” who “fail to adequately treat them.” These Millennials are American just like you, and they are slipping through the cracks and feeling hopeless – ultimately ending their own lives far too early because of our broken systems. A true epidemic.

The epidemics don’t end there however, we only have to look back a few weeks to find the most recent cyber bullying-related suicide in the news – 14-year-old British student Hannah Smith was the victim. Smith’s death has brought a popular website, Ask.Fm under fire for allowing its users to remain anonymous among other things. The concern is that it is too easy to hide behind a computer screen – there is no accountability, and this takes bullying to new levels. Ask.Fm isn’t alone in the cyber bullying area; last year it was reported that there were over 15,000 bullying-related tweets sent out daily. Millennials are the first generation to face bullying in this capacity – and its taking its toll on our generation.

I’ve only just touched on the issues that are contributing to mental illness and suicide within our generation. My goal was to lay the groundwork for better understanding that suicide prevention is the responsibility of all of us, because the circumstances of those at risk vary so greatly and the underlying cause is not necessarily what it seems. We continue to put bandages over broken systems, but if we want to truly see an end to suicide within our generation and beyond, we need to dig deeper and address the many social and cultural issues.


Make sure to join us NEXT WEEK for #MillennialChat.  Our topic is Millennials and Mental Health.  We will be joined by Heidi as well as Partners for Mental Health!  The chat is on Twitter on October 22nd from 1-2pm EST.  Any questions to get us started? Put them in the comments section below.

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Who DOESN’T like to take the summer off?

Oct 14 2013

It feels so good to be baaaaaack!

It’s been a while since we have had a MillennialChat, but who doesn’t like to take the summer off?  It is a great time to take a trip (or multiple trips), catch those concerts you’ve been wanting to get to, and just unplug from everything.

To those of you who asked periodically if there was a MillennialChat on certain weeks, I apologize, but I hope that you all had a great summer.

picstitch

Picstitch of my favorite trip of the summer. Out in Nashville, TN, we saw the Belle Mead Plantation, went to a Full Moon Pickin’ Pary, and stopped to get some Waffle House – a full weekend.

Okay now let’s talk about the future of Millennial Chat. We experimented with monthly themes a while back, and we are going to get back to that!  We will have topics for each month, and each month will include a chat with guest experts followed by a chat among millennials.  The other two weeks will include blog posts to spark conversation and a week to reflect on the information gathered that month.

October – Mental Health Awareness

Our theme this month was suggested by a great friend of the chat – Heidi Oran (@HeidiOran).  We are flooded with Pink in the month of October for Breast Cancer Awareness, a fantastic cause; however, October consists of Mental Health Awareness Day.

I am no expert on mental health, nor am I up to date on the statistics, but from conversations I have had with others on the subject, Mental Health is a topic that millennials need to tackle.  Our partners for the chat next Tuesday, October 22nd are Partners for Mental Health (Canada), Heidi Oran and her MillennialMentalHealth.com crew.

From Partners for Mental Health’s website, you can see that stress, anxiety, and depression have become common among Canadians, and I think that is fair across all nations.  The rise of social media and technology has only forced us to feel like we need to be plugged in at all times, working a lot of the time, and subject to others’ “great” lives one Instagram photo at a time.

Mark your calendars today!

Join us Tuesday, October 22nd from 1-2pm EST.

Follow the hashtag – #millennialchat

Tune in here for more blog posts to get the conversation rolling! Don’t forget to follow – Partners for Mental Health and Heidi!

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Millennial Chat – When are you coming back?

Aug 12 2013

Hello chatters!

I just wanted to give a quick upate as to when you will see #MillennialChat back in action… … and the answer is:

OCTOBER 8TH.

I want to start focusing the chats a little more and only having them once a month.  We will start again on Tuesday, October the 8th because that is the 2nd Tuesday of the month.  From here on out, #MillennialChat will be held every 2nd Tuesday of the month.  We will focus on many things, but mainly highlight great and positive groups that are helping are world and run by A millennial, a PACK of millennials, or an ARMY of millennials.

Do you know any groups/causes/charities that fit this bill?  Tweet us – @MillennialChat – and let us know who we should get in touch with.

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Scott Stein Interview: Civic Engagement & Social Entrepreneurship

Jun 20 2013

Having the honor to interview millennial thought leader, Scott Stein, two days ago was fantastic.  Much conversation about how our generation can take civic engagement to the next level, and what we are seeing already with how social entrepreneurship taking off.

Mobilize.org gained a fantastic person to fill the Executive Director role.  Hopefully our chat yesterday convinced him of the importance of Twitter!  Check out the entirety of the chat below in the transcript!


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CHAT PREVIEW: Scott Stein and Civic Engagement

Jun 14 2013

I am very excited about the upcoming #MillennialChat next Tuesday.  It is on the same day but a DIFFERENT TIME!

 

TUESDAY, 6/18: 3PM EST

Mark your calendars.  Those west coasters always put us on a different schedule! But we love them none the less.

Scott Stein joins Mobilize.org as their new Executive Director! He is a great Millennial thought leader and has more than a decade of experience in the political and non-profit sectors holding senior positions on gubernatorial and US Senate campaigns, as well as top fundraising positions for a variety of political and civic engagement non-profits.

We are very glad to have the honor of interviewing him about Civic Engagement and Social Entrepreneurship.  To learn more about Scott and his new role at Mobilize.org, check out the press release here.  Make sure to tell everyone to be ready for #millennialchat NEXT TUESDAY at 3pm EST.

Make sure to check out THE NEW AND IMPROVED TWEETCHAT. They were just taken over by oneQube and the improvement is phenomenal.

Do you have questions you’d like to pose to Scott? Leave them in the comments section below.  We’ll be sure to relay those to him.

UPDATE (6/18 – 8:45 EST): Questions

Check out the list of questions to be asked of Scott during today’s chat.  We will try to touch on them all, but feel free to build your own questions off of these!

Q1:  How and why did you become involved in Civic Engagement?

Q2: Why do you think that it is important that Millennials be involved in civic engagement?

Q3: How do you see Millennial involvement in civic engagement and social entrepreneurship as differing from that of other generations?

Q4: Can you explain the overlap between civic engagement and social entrepreneurship?

Q5: Do you think Millennials approach the idea of entrepreneurship differently than other generations?

Q6: How do you explain the rise of social entrepreneurship over the past few years?

Q7: How can students interested in civic engagement and social entrepreneurship become active in these areas?

Q8: What do you see as the most pressing issues regarding civic engagement and social entrepreneurship?

Q9: Where can Mobilize.org grow in civic engagement and social entrepreneurship?

Q10: How can Millennials unite with older generations to make the most effective change?

Q11: Do you see Millennial stereotypes and negatively affecting engagement and entrepreneurship?

Q12: Do you see their involvement in civic engagement and social entrepreneurship as a way to change the self-absorbed Millennial sterotype?

Q13: What are the best ways to get started as a civic engager/social entrepreneur?

Q14: What strategies have you found to be most effective in engagement and entrepreneurship?

Q15: Where do you see civic engagement and social entrepreneurship going in the future?

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Chatter Reaction to “How do I put time on MY Side?”

May 06 2013

Last Tuesday’s chat sparked some really good conversation around time management.  If you’d like to see the entire chat, click here.

I reached out to two chatters who had some very good tips about how they try to keep time on their side.  Hopefully these tips can help spark ideas for YOU to help with time management.

Time is of the essence.

Time is of the essence.

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For me, it’s all about the list(s)!

by Rebecca Spain (@NPmillennial)

I find it incredibly difficult to get things done when I don’t take time to first plan a) what I’m going to do and b) how I’m going to go about it.

First, I get everything out of my head and onto paper (yes, paper, I’m a bit old-fashioned in that way). Once everything is written down, I categorize and prioritize.  I sometimes also create a timeline for my priorities so I know how long I have to get different tasks done. Then, I create a list for my top few priorities and cross off (that’s my favorite part!) items as I go. Creating the larger list also shows me what I need to say “no” to, push off for some time, or delegate to others.

While my lists don’t get the tasks done, they make them much easier and less stressful to accomplish.

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As an emerging professional, my time management revolves around project deadlines and strategic plans.

by Kait Solomon (@KaitlinSolomon3)

Using my time efficiently not only improves my quality of work, but allows me to take on more responsibility as I advance in my career.  My biggest tip for those struggling with time management is to learn how to prioritize. I divide my time at work into 3 categories: monthly tasks, short-term projects, and long-term developments. 

I always schedule monthly tasks in advance so I can see what time is left for other projects. Understanding the operational steps involved in each project helps me realistically determine the time needed to complete each phase. I break down short-term projects by creating timetables, and organize long term initiatives using strategic calendars I create in Excel.  Organizing a project by stages allows me to visualize how I should divide my time during the work week, month and fiscal year.  Having a process keeps a project on track, and keeps you sane throughout the duration!

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Whether it’s a list on paper, excel, or Google calendar, time management is different for everyone.  Hopefully these two chatters gave you an idea that you can turn into your own.

Have you found a great strategy that has worked really well for you?  Comment below.

Check us out on TUESDAYS every week from 1-2pm.  Learning from millennials and connecting with millennials!

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