TIGHTENING YOUR BOOTSTRAPS

AuthorHouse

Contents

Acknowledgments................................................................................ixIntroduction...................................................................................xiChapter 1. Overcome Your Fears.................................................................1Chapter 2. First Things First..................................................................13Chapter 3. Was The Spending Worth It? Spend Less, Make More, And Save More.....................43Chapter 4. Focus, One Bill At A Time...........................................................81Chapter 5. Stick To The Plan...................................................................101The Essence Of A New Day.......................................................................119About The Author...............................................................................121

Chapter One

"The answer, maybe, is going out and doing rather than waiting. If you wait, life will probably pass you by. But if you go out & do the things you want to, take the risks you fear, you may just find that everything slots into place." —Rob E. Geraghty

Tip #1: Face Your Fears.

Have you ever run away from your fears and they become stronger and greater? Running away only leads to more stress and time wasted. Face your fears today and overcome them. If you don't overcome your fears, they will eventually overtake you. The first step to overcoming your fear is to identify what you are afraid of.

If you have this book in your hands, you are probably looking for tips that will help you to decrease the amount of debt you are carrying, increase the amount of money you have saved, and create and implement a working budget. The very first tip that I recommend is for you to face the fear of being in debt head-on. Realize that the debt is present and you have the tools and strategies needed to decrease it. If you are afraid of being in so much debt that you will lose everything later, make sure you learn everything you can on how to spend, save, and balance your budget now. This book will start you off with tips that will guide you on ways to decrease your debt.

Tip #2: Enforce Discipline.

Another useful tip to decrease your debt is to discipline yourself. You need discipline to stay out of the stores, put your credit cards away, and stick to a plan. It is easy to pick up a credit or debit card and go buy a new pair of shoes that you don't need. Figure out the reason(s) behind your spending habits.

Are you bored or lonely? Getting back at your spouse for not showing you attention? Are you stressed out at work or home and find yourself at the mall relieving stress? Put your spending habit under control. Make yourself walk at the lake or talk to your friend to relieve stress rather than going to the mall. Put a stop to unnecessary spending by disciplining yourself and refocusing negative habits into positive ones.

Tip #3: Take Actions to Decrease Your Debt.

"Faith without works is dead" (James 2:17). We have faith that God will cancel debt and line up our finances. Where are the works? Are you doing your part? Expecting God to give you a new job? Have you sent out your resumés? Expecting God to pay off credit card debt? Are you still spending on the cards? Take action and do your part to decrease your debt.

It is easy to talk about how much debt we have and not having the right job, but stop right now and ask yourself, "What have I done this week that will help me accomplish my goal of decreasing my debt?" If you are sitting still, ask yourself why. Are you lacking motivation? Do you not know where to start? Ask yourself these questions to identify the best approach to taking action.

Tip #4: Be Willing to ...

Are you willing to sacrifice now in order to get ahead later? Be willing to downsize if you can't afford your mortgage. Be willing to wear those jeans once more before you toss them in the trash. Be willing to take your lunch to work instead of eating out with your coworkers. Be willing to catch the bus or train to save money on transportation. Be willing to rent from the $1 DVD rental box rather than spending $20 at the movie theater. Be willing to buy groceries from the meat market down the street, as opposed to the expensive name-brand grocery store three miles away.

Be willing to work out on your own rather than paying for a personal trainer. Be willing to cut your own grass, clean your own house, wash your own car, do your own hair, walk your own dog, paint your own nails, and put on your own makeup instead of paying someone else to do it for you. Doing things for yourself now can lead to a better financial situation later.

Tip #5: Be Willing to Say No.

Be willing to tell your family and friends no. If you are used to going out to eat with your friends every week, you may need to cut back from four times a month to once a month. If you are used to buying your children everything they want, practice right now; open your mouth and say no.

Saying yes when you really want to say no will not help your financial situation. Understand that you cannot please everyone. If you are honest with people and inform them of your financial situation up front, they should be willing to understand once you tell them you are unable to commit to something. A real friend will encourage and support you anyway.

Saying no does not have to be painful. Understand that soon you will be in a better financial situation to potentially say yes. Move forward with integrity. Let go of your fears and simply speak the truth. If you don't know how to say no, let's practice. "I wish I could, but I have other financial commitments at this time"; "Maybe next time when I have a couple of dollars to spare"; or "I have some financial obligations, and the budget is a bit tight right now; would you like to come over for a cup of coffee instead?"

Tip #6: Be Willing to Change.

If you are not able to adapt to drastic change quickly, start slow. Start with your spending habits. Instead of buying coffee every day, buy it only three times a week and slowly transition into making your own coffee to carry to work every day. Start putting away the loose change that you receive after breaking a bill instead of finding something to buy with the money; loose change can add up.

Change starts with you—you thinking change, believing change, and seeing change. Change is sometimes difficult to adapt to for many. Changing someone's way of doing things may be a major barrier to overcome. Exercise change daily until you are where you would like to be financially.

Tip #7: Know It's Not Your Permanent Situation.

Know that seasons change all the time. You will not be in a financial disaster permanently. My pastor, John Hannah, often says, "It won't be like this always." When I hear him say it, I immediately see myself in a better situation. Peace immediately replaces the burden. Know that the current situation will get better with faith and works.

Tip #8: It Is Not All About You.

Help someone other than yourself. If you are a leader in any capacity, people are following you. Look over your shoulder and remind yourself it's not always all about you, but about the people who are following behind you.

Educate others about what you learn and the mistakes that you made with your finances to ensure that others will not make the same mistakes and that they may prosper. Teach your children about debt, using examples from your actions. Show them how you spend and save. Use your personal experiences to help them.

Tip #9: You Are Not in It Alone.

Don't think you are the only person struggling with debt burdens. Millions of people are in debt—all races, both genders, the educated and uneducated, the professionals and the amateurs. Forty percent of Americans spend more than their monthly budget. Don't be included in this statistic; be compared against it.

Tip#10: Be Prepared to Put Up a Fight.

There are many issues that we waste our time fighting with. Why not fight for the burden of debt to be lifted? "Put Up A Fight," with lyrics by Kicked In The Head, is a depiction of someone being kicked around by debt.

It is time to put up a fight with debt. Don't just keep sitting around and being dragged around and defeated. Put your boxing gloves on, ball up your fist, take one step back, and aim at the debt, one knockout at a time.

Chapter Two

"The main thing is to keep the main thing, the main thing." —Stephen Covey

Tip #11: Talk about Your Debt to Others.

One main goal is to expose the barrier by talking to others. Tip #11 is probably the most difficult tip to tackle. Tell someone about your debt. Communicate how it has negatively affected you and your family. You will establish a group of people who will not only support you, but who will also understand when you say, "I can't go to the mall to shop today" or "Come over and I can prepare lunch, instead of going to an expensive restaurant."

Tip #12: Have Balance.

Have balance by living for today and tomorrow. My husband lives for today—"You never know if we will be here tomorrow." I live for tomorrow—"What about having money for tomorrow?" The living for today mentality can have you doing things today that you will regret tomorrow. If you don't have a plan in place to pay off your credit card immediately when you return, it's not a good idea to leave for a vacation, charge all expenses to your credit card, and make a mental note to eventually pay the credit card off later. It ends up costing much more money and stress than it would have otherwise when you come home from a great vacation only to worry about how you will pay for it.

Living for tomorrow is not a better solution. In fact, you may regret not living for today if you continually focus on tomorrow. An example of how living for tomorrow may not be a great plan to follow is putting so much focus on tomorrow that today is wasted; this will cause the years to fly by without you getting any enjoyment from life. Now, the best living is to plan, research, and save the money needed for tomorrow. When tomorrow comes, enjoy it and feel better.

Tip #13: Pay Tithes.

"Bring all tithes into the storehouse and prove me now, said the Lord, if I will not open you the windows of heaven, and pour out a blessing, that there shall not be room enough to receive it" (Mal 3:10). One of the biggest testimonies that my husband and I can share is how paying our tithes helped us financially. God wants us to promise to give 10 percent of our income to him (the church). We give our tithes cheerfully and in obedience, with great joy and knowing that God will provide us with our wants and needs.

Tip #14: Give.

Luke 6:38 says, "Give, and it shall be given unto you; good measure, pressed down, and shaken together, and running over, shall men give unto your bosom. For with the same measure that ye mete withal it shall be measured unto you again." Have you heard the saying "If you keep your fist balled up to prevent yourself from giving, it will stay balled up to prevent you from receiving"?

I remember that when I was child, my mother saw a need to bless someone with furniture. She gave the person and her children our couches, bedroom sets, and other household items. I was thinking then, "What about us?" With in a month or so, God blessed us with even better and more furniture. Be a cheerful giver, even if it's not much to give.

Tip #15: Have a Weekly or Biweekly Date with Your Finances.

It's not easy managing your finances with all of the other demands in your life. Carving time out of your busy schedule—the same way that you do with work, activities, and hobbies—will ensure that you remain on task and financially organized. My advice is to carve out twenty to thirty minutes every time you receive your paycheck.

If you get paid weekly or biweekly, plan some time during your payday to pay your bills and review your finances. Look at how much you paid on certain bills, your next focus and strategy for paying off the next bill, and so on. Use this time to write in your journal, putting a line through the name of the credit card you paid off, writing down how much you were able to save and the next goals you wish to focus on.

Tip#16: Stop Running; Talk to Creditors and Negotiate.

Talk to creditors; most are willing to work with you. Call companies ahead of time if you know you are going to be late on a payment. If you missed or are late on payments, ask them to waive the late fees associated with your account.

If you are not happy with your current interest rates, call and ask your creditors if they can lower your interest rates, which can result in a load of money in your pocket to pay off other debt faster. Negotiate affordable payment plans. Go to the creditor with what you are comfortable with paying and the timeline by which you are comfortable paying. Most creditors are willing to work with you, especially during bad economic times when you can just walk away. Instead, show the creditors that you are willing to work with them.

Tip #17: Learn to Use Cash Instead of Credit Cards.

Put away your debit and credit cards for emergencies only. Use cash instead. Benefits come with using cash instead of credit cards. If you know that you would like to go on vacation next summer, start planning now. It's cheaper to research deals and save for your trip than to wait until the last minute and pay with a credit card that will accumulate interest.

Three advantages are attached to using cash instead of credit cards. The first advantage is being able to keep track of what we spend our money on, while eliminating the scare that we receive at the end of the month when we get the bill. The second advantage is eliminating the fees associated with credit cards. The third advantage with using cash instead of credit cards is to receive possible discounts; with cash, it's easier to negotiate prices.

Tip #18: Use Direct Deposit for Your Paychecks.

Use a free direct-deposit bank account. Shop around at local banks and ask if there are fees attached to setting up a direct deposit and inquire about any additional or long-term hidden fees that customers may be responsible to pay. Cashing checks at local currency exchanges requires not only fees, but also time spent going to the currency exchange every payday.

Tip #19: Don't Get Into Debt.

This is an obvious tip, but sometimes we need to see things in writing before the message sinks into our mind and before we start the implementation process. If you can't afford it now, wait and save the money until you are able to purchase. Also remember, when you are paying off debt or have paid off debt, don't get back into debt by implementing old habits.

Tip #20: Be on the Same Page as Your Spouse.

Statistics show that one of the top reasons for divorce is financial constraints. If you share your finances with your partner, it's important that both parties are aware of how the finances are being handled and the two of you are on the same page. One person in the relationship may have the mantle to handle the finances, but both parties should be in the know.

As the person responsible for the finances, ensure that the bills are paid on time, you save money, and your spouse is always in the know of any financial changes. Together, we discuss the best financial plan for our household. Working together is beneficial to success in your finances and marriage.

Ask your spouse the following questions: Who is best fit to manage our finances? Why? Which one of us has the time to manage our finances either on a weekly or biweekly schedule? Who is the most organized to keep records of which bills are due and their due dates? Who is more willing to communicate to the spouse for the purpose of keeping them in the know?

From the answers to the above questions and any others, decide on which spouse will be more sufficient in managing the finances. Both persons may be able to do the job, but one person may have more time to get the job done. Remember, managing finances may be difficult at first, but make sure that the person responsible pulls in the other spouse for help if needed.

Tip #21: Find the Tools and Strategies That Work Best for You.

It is important to understand which tools and strategies are more comfortable for you to become successful in your finances. What works best for you may not work best for someone else. Do you prefer to pay your bills online or pay them by check and in the mail? Do you prefer to grocery shop once a month or weekly? How often do you like to review your finances? At the beginning of every month? During every payday? Are you organized? If not, do you need an Excel spreadsheet to help you with organizing your bills, payments, and due dates?

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Excerpted from TIGHTENING YOUR BOOTSTRAPSby KAREN RATLIFF Copyright © 2010 by Dr. Karen Ratliff. Excerpted by permission of AuthorHouse. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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