Resolve to Solve Your Money Problems

Long before recessionista became a word, Carla Emery was doling out the kind of sage wisdom that can make your New Year's Resolution to live frugally a reality.

Don’t buy anything new if you can help it. Write what you need on a list, and then watch and wait. You probably don’t need it all anyway. Never buy on impulse. Buy only what’s on your list. If you see something you like, go home and think about it. If it was really that good, you can put it on next month’s list. Attend auctions and yard sales; go to secondhand stores. If you can’t find a bargain, wait.

And if that blast of practicality was enough to get you motivated, check out this helpful regimen for success.

Below is a 10-step plan to get your money under real control, have what you truly need, and get some enjoyment out of life too! But first there’s the pain of looking into the possible black hole of your pocketbook. What you don’t know really can hurt you terribly in the case of finances, hurt you even more than finding out. Tell yourself: no pain, no gain! Then work your way through this 10-point path to financial recovery!

1. Track your spending history. Write down the basic categories like food, clothing, utilities, home payment, etc. Go through your bank statements from at least the past 3 months, and assign every purchase to a category. This will give you an average picture of how much you’ve spent in each category each month.

2. Keep a “Dollar Diary” to track your cash expenditures. Anything you spend habitually can add up fast, maybe more than you realized.

3. Monitor your credit status. Anybody who wants to check your credit rating can get that record; you should know what they’re seeing!

4. Analyze your bills. List them. How much is your total indebtedness? Sort the bills into categories. What are most of them for? For future reference, could any of them have been avoided? Are any of them overdue? How many dollars’ worth is overdue? How long has it been overdue? Are you in debt trouble?

5. Change your habits. For example, If you are bouncing checks, close your checking account, open a savings account instead, and pay your bills with money orders or in cash. That way people can’t pressure you to give them a check.

6. Plan to save. Look for the places in your budget where you can save money. What can you do without? Even little items add up. If you can avoid spending $3 a day, that’s a savings of $100 a month.

7. Create a monthly budget. Most of us can’t even buy very much of what we want. So we need to get along with what we do have — and what we can afford.

8. Spend less. It’s all about choices: Generic prescription drugs? Buying on sale? Packing a lunch? Buying in bulk? Car pooling or riding the bus instead of driving?

9. Earn more. That’s easy to say…. Brainstorm creative ideas to increase your income such as Rent out a spare room or do free-lance work in your field.

10. Invest. That’s your cushion against emergencies, and your down payment for a home with garden space or with acreage for livestock, or your capital for starting a business that’s going to provide even more income or allow you to do the kind of work you really want to. It does take money to make money.