Here’s my little Happy New Year gift to you. Each day in January, I’ll bring you a simple, concrete and easy to put in place tip to fuel your efforts to Save Money, Pay Off Debt, and Be Awesome this year. Looking for a quick plan? Well this might not to be the right place for you. Most things down well take time. But that doesn’t mean you can’t begin to implement systems in your life that will help you achieve your goals. I’ve said it many, many times before. Paying off debt isn’t complex. It’s just not easy. You have to punch the clock daily and do the hard work. Here’s another way to make that happen.
Day 26: Keep Excellent Records
It’s an average Saturday here in the Queendom. The day has been filled with a mix of laundry, cleaning, work, and rest. Now, here we sit, balancing the books. Both girls are busy reading and the King of Free is working on organizing our tax information for the year. The brown paper covered box decorated years ago by the Princess Eldest is filled with receipts and records for the last year. I man the keys on Quicken, quickly looking up specific categories of expense as the King calls out for them.
If you want to Kick Debt in the Teeth, you need to keep excellent records, not just for tax purposes but for life purposes. Each morning as I guzzle sip my coffee, I reconcile the checking account, matching what has cleared to what I have forecasted in our budget. Checking and double checking to make sure all of the accounts are in line and confirmed to the penny. It might seem cumbersome for most but I find joy in looking through the line items of the past and glancing at what is coming down the road. Income, expenses, budgeted dollars for giving and saving and spending, all dance in numeric rhythm.
I know this can be a difficult step for those of you not used to keeping a record of your spending. If the concept is completely foreign to you, it might be bumpy at first. For numbers nerds like me, it’s a little bit less painful. But I must admit even I didn’t keep a close enough eye to what we were spending and where until we began our journey of paying off $127K in debt. So how can you begin this process?
- Collect Your Receipts for 30 Days: I’ve mentioned this when talking about budgeting. Even the practice of simply putting all of your receipts for 30-60 days in an envelope or basket will be a teeny step in the right direction. From these receipts, you can get a realistic idea about how much to spend on everything from groceries to gasoline each month.
- Monitor Your Bank Daily: You know which Avenger would be the best to lead your finances? Hawkeye. Use your Super Vision to daily monitor your bank account. If you’re an online Avenger, make it a practice to daily look at your bank account matching the cleared transaction with either your paper or software budget. Quicken allows me to mark each item as “Reviewed” and place a little circle next to the items I’ve matched. Your bank might even sync with software with a simple click. It’s still a good idea to look at both your account and your “ledger” whether it be paper or digital. It should be your goal to write down every purchase you make within 24 hours of making it. Be diligent. It will be worth it in the long run.
- Categorize EVERYTHING: If your system allows, drill down each expense to the nickel. I categorize Medical Expenses by whether it was money spent on a physician, pharmacy, or tests and then add another category to track which member of the family had the expense. As specifically as you can, note how much you spent, where, and why.
- Avoid Abbreviations: If you are using a paper register or a program like Quicken, don’t abbreviate the payee. For instance, I donated $35 to GBPO in 2013. I have no stinkin’ clue what GBPO is now and so I can’t look for the appropriate site to print out a record of my donation. By the way, anyone know what GBPO is?
- Track Your Journey Well: I cannot tell you how much joy I STILL receive from the crumpled up, coffee stained piece of notebook paper on our fridge where I kept a running total of how much debt we had paid off. After each extra contribution, I made a new total. Now that silly piece of paper is a reminder of Freedom – how we were delivered from debt, set free for a purpose. We placed it on the refrigerator so we could see it every time we left our home and every time we returned. The visual reminder of excellent records still spurs us on to intentionality in our finances. Maybe you need to construct a thermometer to “fill in” or maybe you want to make a piece of art out of your journey. Maybe you’ll write everything in a journey. Maybe you’ll start a blog. Whatever form your record you keep, be consistent each time you pay off a debt. No matter how many times you think you’ll never forget a purchase, a payment, a victory, or a defeat, if you don’t actually write it down, it will slip into the void of your brain where important information lies but can’t be accessed. Non-essentials like Amy Grant lyrics from the 1980s, sure you’ll still have those but the important stuff will disappear.
A notebook, a box, a folder, an envelope, a laptop . . . whatever your chosen method of record keeping be, keep excellent records to Kick Debt in the Teeth.
Have you missed other 31 Ways Posts? Check out:
- 31 Ways to Kick Debt in the Teeth: Pray
- 31 Ways to Kick Debt in the Teeth: Don’t Quit Even When You’re Weary
- 31 Ways to Kick Debt in the Teeth: Shop at ALDI
- 31 Ways to Kick Debt in the Teeth: No More Excuses
- 31 Ways to Kick Debt in the Teeth: Knock Off the Pity Party
- 31 Ways to Kick Debt in the Teeth: Stop Freaking Out!
- 31 Ways to Kick Debt in the Teeth: You Can’t Buy From Every Fundraiser
- 31 Ways to Kick Debt in the Teeth: It’s an Emergency!
- 31 Ways to Kick Debt in the Teeth: Clean Your Room!
- 31 Ways to Kick Debt in the Teeth: Be Careful the Company You Keep
- 31 Ways to Kick Debt in the Teeth: Visualize Victory
- 31 Ways to Kick Debt in the Teeth: Get Your Coupon On
- 31 Ways to Kick Debt in the Teeth: Work It
- 31 Ways to Kick Debt in The Teeth: Move It
- 31 Ways to Kick Debt in the Teeth: Communicate with Your Spouse
- 31 Ways to Kick Debt in the Teeth: Set Limits
- 31 Ways to Kick Debt in the Teeth: Dream On
- 31 Ways to Kick Debt in the Teeth: Quit Eating at Restaurants
- 31 Ways to Kick Debt in the Teeth: Read a Book, Why Don’t Ya?
- 31 Ways to Kick Debt in the Teeth: Change Your Mind About Budgeting
- 31 Ways to Kick Debt in the Teeth in 2014: Plan Yo’ Meals
- 31 Ways to Kick Debt in the Teeth in 2014: Use CA$H
- 31 Ways to Kick Debt in the Teeth in 2014: Sell, Baby, Sell
- 31 Ways to Kick Debt in the Teeth in 2014: Stop It
- 31 Ways to Kick Debt in the Teeth in 2014: Introduction
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I’m so looking forward to sharing this month of challenge and inspiration with you. Together, we can show debt who’s boss and give it a swift kick in the teeth this January and throughout the year in 2014. Away we go!
Gain inspiration to pay off debt! Check out Inspiration to Pay Off Debt: 30 Days of Encouragement from the Queen of Free
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