Page 24 - Book3E

When performance is meas- ured, performance improves.
—Thomas S. Monson
16
Household expenses are much different today than they were even 20 years ago. In the 1980s, households had one telephone, which may or may not have included long distance. Today, it’s not uncommon to have two or more phone lines plus a mobile phone and Internet. What used to be a $30 monthly expense can now be as high as $200 per month. Such expenses require a different kind of planning than your parents did. That’s why you need to get the advice of financial professionals to put you on the right track. Your FFEF counselor can be a great resource in helping you make wise decisions about your family budget.
If you are the kind of person who likes to see immediate results, and many of us are, try the alternative suggested by Dave Ramsey, author of The Total Money Makeover. Instead of paying off the debt with the highest interest first, which often takes a considerable amount of time, Ramsey suggests that you “list all
of your debts, smallest to largest, including medical debts and debts to parents.” All debts receive a monthly payment but balances are paid off one at a time, smallest to largest. “This approach gives you some quick wins. It’s like losing five pounds in the first week of a diet.” FFEF uses this approach to help reduce the amount of debt while helping you see success in eliminating your debt.
To overcome the habit of relying on credit cards, Teri Cattina at Bankrate.com suggests you do whatever it takes—holding a yard sale, making only minimum monthly payments, cutting back on the fancy restaurants or eating out at all—to accumulate $1,000 in the bank. Having this small reserve fund to pay for emergencies will help you stop relying on credit cards to get you through the month. A great way to boost this fund is to deposit your tax refund or an unexpected work bonus into an emergency savings account to protect you from those emergencies.
Measuring Your Current Progress