When I started my debt-free journey in August 2013, I had $57,847 of student loans and credit card debt.
I wasn’t always serious about paying off my debt, but as of last month I’ve paid off 60% of my debt and built up about $6,000 worth of assets.
Although I’ve been on this path for more than 4 years, I still learn new lessons about money all. the. time.
And so, today I’d like to share a little of what I learned in 2017…
Lesson No. 1: The journey is easier when you track your spending everyday.
This isn’t the first time I’ve talked about tracking your spending – and, the last time I wrote about it, I recommended tracking your spending at least once per week.
Well, we’re way past that now.
Now, I say that – to make your finance journey so much easier – it’s important to track your spending at least once per day.
Here’s why: I’ve learned that money mindfulness makes it a lot harder for me to overspend. And, if I overspend, I’ll do a whole lot less damage if I track my spending every day than if I only track it once per week.
There are plenty of apps to help you do this (and if you try this one, we’ll both get a free month). But, it really doesn’t matter which app you choose. What matters is that you have a system and you use it to track your spending daily.
Lesson No. 2: If you make a mistake, it’s not the end of the world.
I used to always beat myself up about spending too much money. For example, after a night out with the girls, I’d look at the receipts and trigger an instant shame-spiral.
“OMG I spent way too much money!”
“How could I do this??!”
“This is terrible.”
Instead of beating yourself up, it’s a lot better to learn why you make a mistake and figure out how to stop your behavior.
Now that I know better, I bring cash whenever I go out with the girls. I still have the drunken tendency to make reckless decisions about money, but – with a finite amount of cash – there’s only so much that Drunk Katasha can do.
So, if you make a mistake it’s not the end of the world. Just learn from it and move on.
Lesson No. 3: Automate everything.
And, I’m not just talking about your bills.
Automate your bills, your debt, and your savings goal.
Here’s why: I’ve learned that – when I’m in a particularly spendy kind of mood – I can easily convince myself to hold back on my savings goal so I can use it on something frivolous like Uber Eats.
That’s fine if it only happens once in a while, but if it becomes a pattern, then it’s a problem.
So, I take the decision-making out of my hands.
Each payday, my savings pulls money straight from my bank account.
It’s gone so quick I don’t even miss it.
Lesson No. 4: Be kind to your future self.
Here’s a confession: I’m really bad at making money last.
After payday, it isn’t uncommon for my bank account to run out of gas by Day 8. Then, instead of enjoying the budget I’ve allotted for myself, I survive on rice and beans until payday arrives again.
So, how do I celebrate the arrival of a new paycheck? By blowing my budget, of course!
When I get paid, I try my darndest to be nice to Future Katasha. If I treat her well, I know she’s going to ensure I won’t starve in between paychecks.
Welp, those were my lessons from 2017! Hopefully, I’ll stick to these and not have to relearn them (that happens sometimes).