Budget the Luxuries First! -

Home
>
Debt Relief
>
Budget the Luxuries First!

Budget the Luxuries First!

Strictly speaking, his advice was preceded by another Heinlein maxim as well. "Sovereign ingredient for a happy marriage: Pay cash or do without. Interest charges not only eat up a household budget; awareness of debt eats up domestic felicity." Today, that advice gets abused eight ways to Sunday, as the average household is currently carrying credit card debt to the tune of over $10,000. Assuming an interest rate of 18%, this works out to about 150 bucks a month going to the credit card company. That's money NOT available for things like fresh flowers on your desk... new skis... upgrading to gourmet coffees and wines for daily consumption, or dinner out (including tips and babysitter).

Luxury item #1: Get out of consumer debt

Being debt-free is an incredible luxury! There are a ton of books and articles out there already on how to budget and avoid debt, so I won't hold forth on how to do it. The important issue is WHY to do it. And the answer is simple. Peace of mind is the ultimate luxury!

Luxury item #2: Make some time to make a wish list!

While putting the wheels in motion on reducing debt, there's a happier issue to think through as well: What is it you really want out of life? Peace of mind (and of household) starts with asking these Really Big Questions!

More importantly (assuming you actually care about your relationship), what is it your partner craves? If you don't know, well... it can be fun finding out. Too many financial planning exercises are painful, which is why not enough people do them. This exercise, finding out what really matters to you both, isn't.

What are the things in life that really feel like luxury to you? Now is the time to identify them, and separate out the smaller, less satisfying things you're paying for that keep you from getting what you really want.

To keep to the spirit of fun, I've found it's useful to agree to some simple ground rules:

Make some unbroken wish list time for the two of you
There are no such things as 'silly ideas' or 'waste of money' items during the wish list time (that will come later on during a reality-check period)
No impulse spending during the wish list time! Window shop if you want, share a seat in front of the computer if you're looking online... my preference is to go hang out in antique markets and bohemian shopping districts for ideas, but you might prefer to go visit a travel agent's office or web site. It DOESN'T matter!
Each partner gets equal time to show off their ideas if they want it.

Being realistic, there will, of course, be a price tag associated with the wish list. Also being realistic, not all luxuries cost an arm and a leg, either. If you have the iron will to make a strict budget and do without so that you can go hang out in Tuscany for a month next fall, good for you (and yours!) If you're like me, though, it may make sense to make do with lesser luxuries.

Luxury item #3: Keep looking until you find reasonably-priced luxuries that really make your life more worth living, then revel in them!

That's all it takes. If you get this far, you've done a few extremely healthy things. For starters, you've actually talked to your sweetie about money, without it being a crisis! You've spent some time dreaming together. You've examined your debt and thought about what it's costing you. And with any luck, you've found at least one thing you can enjoy without feeling guilty about what it's costing you... because it's an investment in your piece of mind.

Print and Internet publication rights are granted, free of charge, for this article, provided the credit paragraph and copyright remain intact.

If you use this article in HTML form, please set resource link as a hyperlink. Please e-mail me the URL of any place the article is posted, or a copy of any electronic newsletter or eZine, etc. A copy of any printed publication using this article would be greatly appreciated (contact me via e-mail for mailing address!)

About The Author

andy@coudycoffee.com

In The News:

Gulf Times
Ivory Coast could get debt relief mid-2009 - World Bank
Reuters South Africa, South Africa - 23 hours ago
This is Ivory Coast's third attempt at HIPC debt relief. According to Economy and Finance Minister Charles Diby Koffi, external debt repayments amount to ...
W. Bank says Ivorian aid tied to cleaning up cocoa Reuters South Africa
all 11 news articles

BBC News
Progress seen in debt relief for poor countries
Pakistan Dawn, Pakistan - Sep 4, 2008
By Masood Haider UNITED NATIONS, Sept 4: A new UN report finds significant progress in providing debt relief to the worldâ€™s poorest countries. ...
Poverty-reduction aid lags, study finds Los Angeles Times
DEVELOPMENT: UN Warns of Faltering Goals on Aid, Trade IPS
Donorsâ€™ Aid to Poor Nations Declines, UN Reports New York Times
UN News Centre - Reuters South Africaall 184 news articles

Hurricane Relief Efforts Create Red Cross Debt, Nonprofit Says
Washington Post, United States - Sep 5, 2008
By Philip Rucker The American Red Cross said this morning it is going deep into debt to fund a $70 million Hurricane Gustav relief effort, ...

Handloom weavers may get debt relief
Business Standard, India - Sep 2, 2008
After the debt waiver scheme for farmers, the Union government is hoping to extend a similar scheme for handloom weavers. The Union textiles ministry, ...

Bankruptcy lawyers can advise clients on debt-court
Reuters - Sep 5, 2008
The amendment in dispute prohibits debt-relief agencies from giving clients advice about taking on more debt before filing for creditor protection. ...
8th Circuit: Bankruptcy Provision Violates Lawyer Free Speech Rights ABA Journal
all 5 news articles

Gene F. Turnwald: Debt relief might be less than it promises
Lansing State Journal, MI - Sep 2, 2008
I ask you to please keep that in mind when dealing with debt relief companies that guarantee to lower your credit card or loan payments and interest rates. ...

Justices fault part of 2005 debt law
Arkansas Democrat Gazette, AR - Sep 6, 2008
â€œThe threat of being labeled as a debt-relief agency has curbed or chilled big firms from doing pro bono work for peopleâ€ who need bankruptcy, Henry Kaim, ...

Group advocates tax increases and non-user fees for sewer debt relief
The Birmingham News - al.com, AL - Aug 29, 2008
At a morning press conference, the group put forward "the people's plan," an 11-point proposal for dealing with the debt. The activists, including a ...

Staying On Track with Your Debt Relief Plan
3x24 - Your Newspaper and News Magazine, Germany - Aug 29, 2008
All these things, however, pale in comparison with the importance of sticking to and staying focused on your debt relief plan. Sticking with a debt relief ...
4 Simple Steps To Getting Rid Of Credit Card Debt 3x24 - Your Newspaper and News Magazine
Settling Credit Card Debt: Choosing the Right Words 3x24 - Your Newspaper and News Magazine
all 3 news articles

Canada Bonds Gain as Economic Slowdown Drives Investors to Debt
Bloomberg - 19 hours ago
``Technically no recession, but no relief from fairly sluggish growth either,'' said Craig Wright, chief economist at Royal Bank of Canada in Toronto, ...

debt relief - Google News