Wow, thank you to everyone who left their well-wishes regarding our beginning a journey toward being debt-free! I so appreciate it, and I am going to need the encouragement and momentum! Oh, and thanks for the money saving tips MoneyWise Moms! (For those of you who don’t yet know Gina, head on over to MoneyWise Moms to learn a plethora of valuable information about how you can save money!)

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Monday I wrote about Budgeting…It’s a Philosophy, and how I have changed my perspective about shopping, saving, and consumption. Yesterday, I wrote about starting our Journey Toward Being Debt-Free and how I figured out that in four short years we could pay down more than $177,000 of debt (and interest) to totally wipe out our second mortgage. Today, I wanted to share with you a few of the resources and money-saving methods I have picked up along the way that will help our family achieve our goal of getting to a debt-free life.

Using the Envelope System to Manage Spending

I have gotten used to handing over the plastic when I make a purchase. It kind of makes the price tag vanish into thin air…or makes it just plain irrelevant because you never saw it in the first place. I believe physically separating my spending money from my savings, physically handing cash to the cashier, and seeing the amount of money in my envelopes diminish through the month will most literally demonstrate my spending habits. The envelope system is transparent and there is no ignoring the amount of cash I give away (well, in return for something else.)

In a nut shell, I am going to withdraw the cash amounts I plan to spend on essentials, such as groceries and donations, each month. The grocery money goes in one envelope and the donation money in another, and I plan to spend from each “stash” separately. If we run out of cash before the end of the month, that’s it. No more. If we have cash left over, we can save it for the next month, or use it to eliminate even more debt.

To learn more about the Envelope System visit Mandi at Organizing Your Way and read her article Organizing Your Budget With the Envelope System, or visit Tsh at Simple Mom and read her article, Keep Your Spending Tidy With an Envelope System.  Or, if you need a visual tutorial, visit this YouTube video entitled, Envelope System Tutorial!

Make Mini-Goals and Set Mini-Rewards

Four years isn’t a long time, but I am sure it is going to seem long. We are working into our budget and calendars mini-goals and mini-rewards to celebrate those milestone achievements. I feel a little pat-on-the back to pick up moral during our journey will be necessary from time to time. Some of our mini-goals include, paying off our auto loan and paying off our HVAC system. (We had to install a new $7,800 HVAC system not even 30 days after we bought our home. Yup, no contingent seller guarantees, and the home inspector…well, let’s just say he didn’t do his job. Lessons learned.) After we reach a debt-reduction milestone we plan to celebrate, either by indulging in a little frugal fun or by indulging a bit more by going out to a sit-down Korean kalbi dinner. But I am guessing that the best reward will be knowing that we have that extra cash to pay down other debt more quickly.

Plan Ahead and Work Ahead

Eating out is always our biggest budget busters. We see it as a form of social entertainment, or a celebration for a job well-done, or just plain relief from having to cook dinner at the end of the day when we are tired. But at $35 for a sit down meal this entertainment is sure adds up fast. So, my solution is to plan ahead and work ahead to make economical meals at home before the kids get crazy and before I get tired at the end of the day.

The other day I took a full inventory of my freezers (I have two), my pantries (I have two), and my fridge. I realized that we have enough food stuffs for shelter-in-place for three months. No joke. So, I went through my ingredients, and jotted down menus that directly correspond to what I have on hand and what needs to be consumed first. AllRecipes.com is a wonderful website that allows you to type in the ingredients you have on hand and searches for recipes that utilize those items. This process probably seems so “duh” to most of you, but it is a task I simply haven’t put on my To-Do list as a priority. Planning menus, and a list of quick-fix meals for those especially tough days, will keep me sane and keep us from spending the extra cash to eat out.

I am also starting to coupon again. (I haven’t in a few months because I had a complete stockpile and wasn’t cooking.) The general idea is to buy items when they are on sale AND you have a coupon for the item so when you NEED the item you don’t purchase it at full retail price. CouponMom.com is a great informational resource that explains how you can buy literally $100 of groceries for $35. I know, I’ve done it. You can download her free e-book “Cut Your Grocery Bill in Half.”  Also, Money Saving Mom has a great wealth of information about couponing. (One of the things Money Saving Mom noted in her podcast interview was that couponing isn’t an overnight, save 75% off  your grocery bill miracle, but rather a journey toward developing frugal grocery habits.)  By planning menus ahead and working ahead to buy items at rock-bottom prices I know our family can become debt-free.

Be Flexible and Reevaluate Often

I know that there will be unexpected events and unexpected expenses along the way and this may delay our debt reduction journey. But we are planning to save cash for these rainy days and we are planing to be flexible. One of the most difficult things for me is to accept is that I don’t have total control all the time. Stuff can happen and it will. And I just need to have the wherewithal to be flexible and roll with it.

We also plan to reevaluate often. We have never tried to adhere to a budget or change our needs vs. wants spending philosophy, so we don’t know how it is going to turn out. If this budget works, great. If at some point it doesn’t continue to work for our family, we’ll change it. Again, for me, it’s all about accepting what is and not getting frustrated trying to make it what I would like it to be.

Keep Your Eye on the Prize

I don’t remember where I first learned this saying, but I feel it is very applicable now. Four years isn’t all that long, but I know it will seem long at times. I need to keep reminding myself that being debt-free is possible, is best for our family, and particularly for our children. Maybe I’ll make a sign to hang in a prominent place…like my wallet.

Are you starting, or walking along a journey toward a debt-free future? Why do you think debt-free living is so seemingly counter to popular culture here in America? Leave a comment here for other readers inspired to live debt-free. Happy Organizing!