Your Money_ The Missing Manual - J. D. Roth [33]
It's not always easy to find ways to earn more money, but almost everyone can find ways to curb their spending. Developing frugal habits is a great first step toward being debt-free. Some people think that frugal living is equivalent to being "cheap," but that's not the case. Frugality and thrift used to be core values in our society, but we lost touch with these ideals during the age of easy credit. Thrift can be a fun way to stretch your hard-earned dollars. (The next chapter discusses ways to be frugal.)
While you learn to spend less, do what you can to increase your income. Try selling some of the Stuff you bought when you got into debt. This can be painful, but ask yourself: Do you really use that weight bench? Is your DVD collection really doing you any good? Use eBay.com and Craigslist.org or the Amazon Marketplace to get some cash for the things you own. Consider taking an extra job or working longer hours. (For more on boosting your income, see Chapter 6.)
Finally, go to your public library and borrow a book on debt reduction. After you finish it, borrow another book about money. The more you learn about smart money management, the easier it'll be to make the right choices.
The most important thing is to start now. Not tomorrow, not next week—start tackling your debt now. Have patience and don't get discouraged if your efforts seem small and insignificant at first. Trust me: Most of us started paying off our debts the same way. In time, your efforts will bear fruit. If you're willing to persevere, you'll have your debt paid off sooner than you think.
Tip
Conquering debt is like playing baseball: Go out there and do your best every single day. If you make an error, don't give up—make the play next time. If you strike out, shake it off and step up to the plate for your next at-bat.
Your Money And Your Life: The Paradox of Choice
In The Paradox of Choice (Harper, 2005), Barry Schwartz describes his research on two groups of people that he calls Maximizers and Satisficers:
Maximizers only accept the best. Every time they make a purchase (or do anything else), they need to be sure they've made the best possible decision.
Satisficers are willing to settle for "good enough." These people still have expectations and standards, but they're willing to settle for something other than the absolute best in order to save time, money, or effort.
Maximizers believe that Satisficers are comfortable with mediocrity, but that's not necessarily true. Satisficers are just as interested in quality as Maximizers—but they recognize that sometimes the extra effort required to move from "good" to "best" isn't worth it.
What does this have to do with your money? Tons. Don't get hung up on looking for the "best" way to manage your finances. Find methods that work for you and your lifestyle, methods that you'll actually use.
Who cares if the debt snowball isn't the best way to pay down debt? Who cares if you don't find the best interest rate for your savings account? Who cares if you don't own the best mutual fund? You've found some good ones, right? Just pick one and get in the game.
The perfect is the enemy of the good. When you spend so much time looking for the "best" choice that you never actually do anything, you're sabotaging yourself. No matter what you're trying to accomplish, simply starting the process plays a larger role in your success than any other factor.
Curbing Compulsive Spending
Many people get into debt because of compulsive spending. They can't keep from buying more—even when that means spending money they don't have. "Overspenders…have confused and confusing relationships with money," write psychologists Brad and Ted Klontz in Mind Over Money (Broadway, 2009). "On one hand, they're convinced that money and the things it can buy will make them happy; yet they're often broke because they can't control their spending."
A spending addiction