Get Out Of Debt: But I Spend More Than I Make
As I’ve discussed in the past, sometimes it isn’t your expenses that are completely to blame, your income factors in as well. You can only go so far with so much.
Maybe you’ve done the budgeting exercise and you’ve realized that no matter which way you cut it, you spend more than you make. It might have seemed just a little bit here and a little bit there, but in the end, the debt climbs instead of being reduced. Hopefully, you’re able to bring it into line with some selective sacrifice, and bring your spending enough under your income to start making some forward progress. But what if you’ve cut everything you can cut and you’re still in the red?
Then really, there are only two solutions - spend less or make more.
Spend less? But didn’t we already say that everything that could be cut has been cut? That may be true, or there may be some more things that can be shaved down or cut some more. Can you move to a less expensive place to live? Do you still have cable television or internet in your home? Do you have two cars, and are you paying car payments on them? It may not be possible to alter these things, but the possibility is worth considering before immediately rejecting them.
So you can’t spend less, and you still can’t make ends meet. The harsh reality is that if you can’t make ends meet, and your expenses are at a minimum, there has to be more coming in. With the holiday season upon us, consider a second job in retail. If you need flexible hours, consider finding a part time online job. There are a lot of ideas for alternative income in this post at Moolanomy that might get you started on the right track.
The answers aren’t easy. There isn’t anything simple about living on the edge. If you can’t bring your expenses down or your income up, the situation will continue to deteriorate. But even if you don’t think so, the ball is in your court. It may seem daunting, or even impossible, to make a change. But change starts with just accepting it needs to happen.
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October 9th, 2008 at 7:08 am
Bravo, bravo! This was an absolutely excellent post! I have read so much about budgeting but this post deals with a difficult issue, a situation that we have been in for quite some time. I chuckle when I read others budgets and after writing it all out, they get to decide where the extra goes. What if there is no extra, or not enough to begin with!?
We have cut, and cut and cut. And now are seeking the second option: more income. While we still consider ways to cut, bringing in a little more will certainly help!
Thanks again for this wonderful post. It was a blessing to me!
October 9th, 2008 at 9:15 am
What a timely subject! I wholeheartedly agree about living on the edge…it’s not pretty. I have cut everything but internet and cable and since they are lifelines for my 19 year old and me, we will keep them.
My new plan is to increase the amount the 19 year old contributes to household living expenses. She is starting a second job with better pay next week in addition to her college classes. Right now she pays our cell phone bill, her car insurance and all her own expenses. I think it may be time for her to pay her share of internet and cable as well, inching toward independence one step at a time. Her college tuition is paid through financial aid grants, not loans.
As for me, in a few months, I can eliminate the hefty individual health insurance payment I make monthly, as I will receive Medicare. And that money, instead will go towards my loan repayment.
October 9th, 2008 at 10:09 am
I wrote about that exact same issue not long ago! I am always amazed at folks who don’t seem to understand that they only have 2 choices. Always it seems they think there’s a 3rd one out there in the nebulous world–???? what??? Money from heaven or Uncle Sam or what??
You either cut expenses or make more $$ that’s the truth.
October 9th, 2008 at 11:17 am
I think a lot of people who balk at a second job don’t realize either, that it’s not FOREVER. You can work your buns off for six months, a year, whatever it takes to make a big enough dent in your debt to not need that second income anymore.
And you’re right, this is the ideal time of the year - I’m starting my second job this weekend at a retail store where I can (hopefully) take advantage of the employee discount for my own gift shopping, as well as making a little extra cash towards our debt.
October 9th, 2008 at 11:57 am
Also, I hope it’s ok, but I’ve also posted a link from my article back to this one. If you’d rather I didn’t please let me know and I will be happy to remove it.
Emiley
October 9th, 2008 at 12:21 pm
I agree with MadeMistakes. A 2nd job should be viewed as temporary and not a forever factor. Having a not-so-great 2nd job can also be used as incentive to destroy your debt faster. It also could open up a new appreciation for your main job. Good luck to everyone!
October 9th, 2008 at 12:34 pm
This is a really good post. I thought about that too as I was making my budget. I can trim back another $500 easily if needed….
October 9th, 2008 at 1:27 pm
I hit the income factor pretty hard in the last few months.
I moved to a city with a higher cost of living and took a paycut with my new job. Off the bat things should have changed in my lifestyle spending, but when you’re not looking at a budget regularly it can be easy to forget to cut your optional expenses.
Now I’m on a budget and figuring out what I can eliminate. When I was in school Starbucks was a treat. Over the past few years it became a daily item. Now it’s back to being a treat. Savings in 4 months is enough to fly and rent a car to go to my grandfather’s house for Thanksgiving.
Luckily I’m going on orders soon which increases my income to start cutting debt and I have a CD coming due near the end of December so I can balance a few things out and dump the rest in my IRA.
October 9th, 2008 at 1:31 pm
Replying to MadeMistakes:
I agree on the 2nd job as a temp option and when I was in college that’s what I did one summer. Work 40hrs/wk on a campus maintenance team, work evenings and weekends at a grocery store.
If I wasn’t deploying in a few months I would take a second job. Instead I’m tightening the budget and finding cheap/free things to do to enjoy time with my friends and family before I leave for a year.
Sometimes this ends up with me utilizing creditcards more than I should so that I can balance things, but right now I view my time as so valuable that I would rather increase debt than be working more than my 40hrs/wk.
October 9th, 2008 at 2:00 pm
It always astounds me when I see people tell me they are broke and yet they still have cable, internet, and a cell phone. Cell phones cost a LOT, especially with all of the bells and whistles of unlimited texting and all of the things people think they must have (and that teenagers think they must have). Almost every twelve year old I know has a cell phone–is it a necessary expense?
All of those things have been my soapbox for years. Thanks for posting this.