Eliminating Debt: Creating And Sticking To A Master Plan

Carmen Wong Ulrich
Carmen Wong Ulrich

By Carmen Wong Ulrich

Okay, you've got a budget going, and you've shopped around for the best deals on your essentials and other purchases. Now you ask me the James Lipton question: “What's my motivation?”

Your goals, my friends. Your goals.

Having small goals, such as trying out that nouveau Pan-Asian joint on Saturday night with your new girlfriend or boyfriend, or larger goals, such as getting a graduate degree or vacationing in the Caribbean, can motivate you to be financially responsible and savvy in ways you've yet to dream.

Setting goals and sticking to a plan gives you a vision to keep in your head when that latte/gin-and-tonic/pair of shoes calls you to buy. It enables you to “just say no.” But we all have goals, some more amorphous than others, so focus is needed. Here are some tips on solid goal making and setting your priorities:

  • When it comes to finances, you've got to concentrate. You may not be able to have both a vacation and a new work wardrobe this year. Which do you want more? Or is there a third goal that can be eliminated so you can have goals number one and two? If you hook yourself into a smaller but well-thought-out set of goals, you have a better chance of achieving them.
  • Pop-up expenses happen. No doubt one week you'll be asked to a baby shower (pop-up number one) and a bridal shower (pop-up number two), and you'll need new con- tact lenses at the same time (pop-up number three). These things can be manageable. Be creative and frugal where you can (with the gifts) while spending on what you really need (those contact lenses). It helps if you keep a small cushion of cash in your bank account to always cover those unexpected yet forever-popping-up expenses.
  • When laying out goals, make sure to look at the time frame. If you're thinking about saving for a down payment on a house, how much time are you giving yourself? By set- ting up a reasonable (and realistic) schedule to complete your financial goals, you'll be able to determine your priorities and budget for other items with longer lead times.
  • Set yourself up right. Make sure you are happy and secure before you work to make anyone else happy. Include an emergency fund into your budgeting goals that can cover you for at least three months without a paycheck. And do your best to take care of debt before getting in any deeper.
  • Get started, pronto. Now it's time to get moving on your money goals, budget, and plans. The sooner you get started, the more rewards you'll reap. And if you're having trouble getting started, do what they tell writers to do when paralyzed by inertia: Sit in front of the computer (or piece of paper) and just start.
  • Don't beat yourself up. Look, we all mess up once in a while. Sometimes you just have to have that freakin' latte or you'll go mad. But learn from the glitches in your plan and get back on course. Ask yourself if what you're spending is taking you closer to happiness (an A-plus on your budget!) or quickening your debt descent.