How I Took Control of My Money & Budgeted My Way Out of Debt

When I turned 15, my parents took me to a quiet, farm country road on a Sunday evening. I gripped the wheel of my mom’s ’92 Ford Taurus. I cupped the parking break. This is easy, I thought. I know what to do. I’ve played Mario Kart a million times! I put the car in drive, pushed my foot on the gas, and jerked us forward, nearly onto the other side of the road. Naturally, my parents clutched their doors and yelled for dear life. In an instant, any feeling of control I had was gone. I’d spend the next few months determined to drive, but all too aware that I had no idea what the hell I was doing. 

That summer, a friend turned 16 and got her own car. One afternoon, she pulled up in our high school parking lot to run inside and get something. Being the obnoxious teenager I was, I thought it’d be funny to get steal her car and park it way on the other side of the lot. I’d had enough lessons to do that, at least. I got behind the wheel, alone (a terrible idea if you’re under 16 and thinking about it), and I suddenly felt different. I felt like I could drive. So I did. I looped around the parking lot, driving like I’d been doing it my whole life. Something clicked. I felt in control, like nothing stood in the way of my being a driver. And from that day on, driving was like riding a bike.

I should probably offer a word of warning here: I am not condoning temporary theft or driving without a license. I could’ve very easily hit a light pole. In fact, I probably should have picked a more responsible story. But, hey, that’s how I learned to drive and here we are. Danger aside, this anecdote illustrates an interesting idea: sometimes just feeling in control can make you do things you didn’t realize you could do.

A similar thing happened with my finances. It’s not quite as exciting (or criminal), but I learned to take take control of my money by feeding off the power of control. Here’s how.

Come Up With a Plan

You’ve heard the stories. Someone was in massive debt, but they turned things around. They paid it off, and found financial security. Those stories are inspiring, and they almost always start the same way: with a plan.

My student debt wasn’t much, but before I had a plan, it felt like it controlled my entire life. I couldn’t go out because of my debt. I couldn’t travel because of my debt. I couldn’t live where I wanted to live, thanks to my debt. I got tired of feeling held back by debt, so I decided to come up with a plan. I drafted a budget. It factored in debt milestones I wanted to reach, and how I planned to reach them. It’s not like that plan suddenly allowed me to go out, travel, and live in a pricier part of town. But my mindset was no longer: I can’t go out because I’m in debt. Instead, it became: I can’t go out because I’m planning to get out of debt. It was my decision.

A blueprint is essential, even if you screw up sometimes and don’t follow it. Even if life tosses a few pricey surprises your way.  It works because it puts you in the driver’s seat. The plan may be to start earning more money. It might be stick to a budget so you can start saving for your retirement. It may be, simply, to chip away at your massive debt. Your goal matters, but it’s the plan that will offer that crucial feeling of control.

Save. Yes, Save.

There seems to be an odd beef among personal finance bloggers: spending less vs. earning more. Actually, it’s mostly about ragging on frugality. No one ever argues against earning more.

“Being Frugal is for Losers” is a clickable headline, but should you read the blog post after clicking, you’ll quickly find it doesn’t really mean anything. All of those posts say the same thing: saving money is great, but not at the expense of time or quality. Guess what? You just described frugality! 

Attacking a boring concept is a great editorial spin, and an effective way to get page views. Unfortunately, it can be damaging to financial wellness. And the latter, I think, is more of a priority.

When I first started reading about money, one stupidly simple, glaringly obvious concept opened my eyes: spend less than you earn to build wealth. It’s a powerful thing in it’s simplicity, especially if you’ve never considered it before. When I read that, I realized I could actually have control over my money if I found ways to spend less and earn more. I never thought of saving and earning as contradictory; they were complementary.

After college, I started earning $24,000 a year. I still lived like a broke college student. When I started earning $45k, I still lived like a broke college student. When I was bumped to $55k, I upgraded my lifestyle a bit. But I still actively lived well below my means.  I earned more, and I lived frugally. This combo helped me pay off my student loan debt in a year and also save enough money to move across the country and switch careers. I could not have done that without utilizing frugality when I started earning more.

But let’s back up and return to this whole concept of control.

When I first enrolled in college, I worked two jobs. After a couple of years, I found a single, better-paying job. In my free time, I sold stuff on eBay and babysat. Beyond that, there wasn’t much else I could do about earning more. While I waited for my degree, saving money made me feel empowered. I could free up some of my modest, $10/hour income if I simply didn’t buy certain things, and that was huge for me. I could actually do something about my seemingly powerless financial situation. Sure, it was a teensy, tiny amount of control. Sometimes, that’s all you need.

Being frugal is not a waste of time. Yes, spending 40 hours a week to clip coupons to save $100 is silly. So is sticking a fork in a light socket. Neither of those behaviors represents frugality. Moreover, frugality doesn’t contradict earning more. Earning more and frugality work wonders together.

Talk About Money

Being open about money can make a big difference, too. Unfortunately, it’s long been a taboo topic, and that makes it a lot easier to sweep financial issues under the rug. You ignore them, and they get bigger and badder, until they eventually completely take over your life.

For a while, I tried to ignore my own financial situation. When I was in student loan debt, I had a spendy, polite friend, and I didn’t want to tell her, “Hey, I’m broke as hell. I can’t afford $60 sushi.” But skirting the issue meant I sometimes gave in and bought meals I couldn’t afford. When I was saving up for my move, it felt nerdy to tell my friends, “Hey, I’m trying to build an emergency fund, I really can’t go to this concert.”

Eventually, my goals became more important than my desire to be polite, so I blatantly began discussing my finances, and not only were people more understanding than I thought, they could relate.

Talking about money, for me, was an important step in taking control. Pretending my financial issues didn’t exist gave them freedom to grow and take over, like a weed. I hate this phrase, but I had to own it. I had to admit, “This is my situation, and this is what I’m doing about it.” It was embarrassing sometimes, but it made me feel comfortable to fully embrace my goals.

Like driving, managing your money can be confusing, overwhelming, and downright scary. Control is everything. Once I felt even slightly in control, I was surprised at how far I could go just feeding off the momentum. Developing a plan was a first step. When I was doing all I could to earn more, embracing frugality made me feel like I had more control. And being open about my finances gave me the confidence to own my situation and drive down that road to financial wellness.

Project CRediT sources data from Wealthy Genius including net worth, earnings, and various wealth statistics.

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