How long will the expenses of Summer stay with you?
For many, the Autumn Season is a financial reckoning of sorts. Vacations, school supplies, and Summer camps can take a toll on your finances that last longer than Autumn leaves.
If you charged your way through summer fun and now you're wondering how to dig your way out of debt I have some tips for you.
Tips for Recovering from Summer Debt
Make a list of what you spent money on.
This helps you make better decisions next Summer. You can adjust (or create) your budget to include expenses that happen each Summer so you don't go into debt for them.
Many people take vacations they cannot afford simply because it is what they've always done. Then, they spend a year (or more) slaving away at work to pay it off only to take another vacation next year. Does that make any sense? Why not budget ahead instead of paying off afterward? Work toward vacation not because of it.
When it comes to school supplies, camps, and back to school clothes, it doesn't matter if your kids are homeschooled, private schooled, or public schooled – you can and should make school expenses part of your monthly budget moving forward.
Figure out your total debt from the Summer.
Knowing this total is the first step to paying it off.
It may be painful to look at the real numbers. It may also take some time to page through your statements but this is necessary work. Categorize the expenses so you know your totals based on vacations, school supplies, and any other Summer-specific expenses (pool maintenance, membership, etc).
Decide on a time-frame for pay off.
What is your goal? Paid off by Christmas? March? Next Summer? Goals are an important step in reducing debt. Without them, you'll easily follow rabbit trails with any extra income you have and never apply it to what is important.
Now, decide what discretionary expenses you can temporarily cut or reduce to help you reach your goal. This doesn't mean you never drink Starbucks again, it means you decide that the $40 you spend a month sipping lattes will be better spent paying down debt for the next 4 months.
Regardless of if you spent foolishly or didn't plan well forgiving yourself is important. Don't hang on to guilt. Instead, make the next right choice to recover and move forward.
Your expensive Summer does not have to ruin your finances indefinitely. You can recover!
If you're looking for more help in getting out of debt, and living debt free check out my free mini eCourse, 6 Steps to Debt Free Living. This free mini ecourse will help you create a strategy to break credit card dependence and loan usage.