Snowballs and Envelopes

No I'm not putting snowballs in envelopes. Because we have no snow :( However, I am toying with the idea of adopting these two strategies. I've known about them for a very long time and have always thought they were fantastic, but never actually implemented them. Probably would be a lot better off now if I had. Hindsight is 20/20 right? Anyways what am I talking about? First off the envelopes.

Frugal Dad wrote about this system in 2008. Yeah told you I knew about this for a long time. Basically the strategy being, when you get paid create a budget for say, food, gas, entertainment etc...and take out the necessary cash and put it in an envelope for each category. So instead of being out and about spending willy nilly, if you're wanting to go to the movies, you have to take out exactly what you need from the entertainment envelope. This will prevent you from going crazy at the concession stand and getting the jumbo popcorn, extra large soda and boxes of candies to boot. Your pants will even thank you for this one!

And now snowballs...

JD at Get Rich Slowly introduced me to the Debt Snowball maybe a couple years ago. I have to agree with him, it's the little victories that keep you going. So instead of organizing your debt from highest balance to pay off first to lowest, reverse it. Start with the smallest. It gives you a greater sense of accomplishment faster and helps keep your momentum going to tackle the next debt. 

I'm now wondering why I never adopted these strategies back in the day. Probably because I felt I had to keep up a certain lifestyle and would be too embarrassed to say "sorry guys, the entertainment envelope is empty. No bars for me." Now, if I have to skip the bars to stay on budget and pay off my debts so be it. Debt free before 30 here we come!

Cheers

Marisa

An Introduction

Hey it's Marisa. Welcome to my first post! So a little about myself and how I got here. In 2010 my 4.5 year relationship with my boyfriend ended and I moved out of our house into my very first adult apartment. (with a roommate) Being single for the first time since I was 20 well.....I went a little crazy. Lots of partying, lots of traveling, lots of shopping for NON home things. By the time 2011 came around and I had settled down the enormity of what I'd done to myself financially set in. Well, mostly because I needed some very important car repairs and I realized then that I hadn't any real savings (turns out you can't trade in your Kate Spade handbag or Michael Kors shoes for repairs) and definitely took a blow or two this summer financially. So after that rude awakening, I decided the party was over and it was time to get my biznazz in order.

Ironically enough (and happily enough) I started dating someone new this summer....who is a financial God. No really, his business is money and futures and the stock market and things that I still don't understand. So it's a bit embarrassing to be dating someone who can plan out their finances FIVE YEARS in advance and I can't even plan mine out five days in advance. Motivation anyone?

So join me as I learn at the ripe old age of 27 how to actually manage my money and not stare at it in my shoe rack/closet. 

Cheers

Marisa