4 Sure-Fire Steps to Eliminate Your Credit Card Chaos & Breathe Easier at Month-End

No matter how great a state our finances are in, there's always room for growth.  

I'm not simply referring to our net worth:  I'm talking about our relationship with money and how it impacts the decisions we make.

Deciding to wrangle that Debt Monkey once and for all is a significant step toward claiming your financial power and moving you into a position of prosperity.  


Here's a simple plan to tackle the dreaded Debt Monkey that puts you in control of your finances and on the path to being 100% debt-free.


Step One:  STOP Using Credit


You won't be able to starve the Debt Monkey if you keep fattening him up.  Switch to a cash-only plan until the bills are paid off.  

Commit to the mindset that if you don't have the cash for something, you simply can't afford it.  Did I mention that this process is not easy? It is, however, a simple process and you can do it.  

It will also take a bit of math. (uggghhh - kill me now!)  

Sit down with your partner and a cup of coffee when the kids have gone to bed and the house is quiet.  Figure out how much money you'll need to cover your living expenses (mortgage/rent, utilities, service fees, gas, groceries...) give yourself a skinny allowance (yep...I said that) for incidentals.  (When I started this process, it was $15 a week).  

What you have leftover is your weapon to attack that monkey!  

Step Two:  Attack Your Debt Monkey

Once those bills come in…open them. 

Don’t hide them in a pile on your desk.  Don’t stash them in a folder unopened in the corner.  Don’t let them sit in your car. (I know some of you do this because I did it myself...for YEARS...and I only sank further into debt!)  Certainly, don’t let them get mixed up with the garbage and put out at the curb by mistake.  

Absolutely avoid the temptation to head out to the mall for some retail therapy!  That only fattens the monkey even more.  

Here’s what to do instead:

• Open up those notifications immediately and face the dreaded Debt Monkey head on with eyes wide open!  There’s no hiding from this battle. 
• Organize your credit card and loan payment bills from the most expensive to the least expensive.  The most expensive bill is not necessarily the one with the highest balance.  It’s the one with the highest interest rate. 
• Pay the minimums on all the bills, except the one with the highest interest rate.   
• Put all the remaining funds that you have leftover for the month down on this one bill.
• Repeat the process.  It’s that simple.

Continue making the minimum payments on everything else except the card with the highest interest rate.  

Once you’ve paid the first card off, roll all the extra funds into paying off the card with the next highest interest rate.  

Repeat the process until all your credit cards and loan payments are paid off.  

Closeout all unnecessary credit cards.  

There.  You’re on your way.  You’re attacking that debt-monkey in a methodical way that is guaranteed to ensure your success...as long as you avoid fattening him up again with more spending on credit.  

Keep chipping away at it and you will get there.  As each bill gets paid off, momentum will increase as you increase the money going down on the next bill.

Step Three:  Trim The Fat

To increase your rate of success, take a look at how you’ve been spending your extra cash.  This trick helped me immensely:  keep the ‘treats’ to an agreed-upon treat time only instead of making treats part of your daily routine.  

What I mean is this…

• Eliminate the regular Tim Horton's & Starbucks runs.  Opt for brewing your own coffee and steeping your own tea at home instead. Trouble totally eliminating the Starbucks habit?  Choose one day a week for a coffee treat.  To celebrate the end of the workweek, make it on Friday, or the beginning of the weekend, make it a Saturday morning outing. Use David Bach's awesome Latte Factor Tool  (https://davidbach.com/latte-factor-backup/)   to find out how much your coffee habit is really costing you.  I guarantee you'll be amazed - you really do have more money than you think! 

• Enjoy cooking dinner at home with your partner or the children in the kitchen instead of going out to eat.  Not only will this save you money, but it’ll also strengthen your relationships AND the kids will learn how to cook.  Bonus!  This step can also tie into your healthy living goals…you control the ingredients, the freshness, the level of healthiness.  Trouble totally eliminating the restaurant habit?  Choose one meal a week to go out to dinner and make that part of your routine as a celebration: pizza with the kids, a date night with your partner, or try something new, fun and exciting like a new restaurant or a new menu item.     

• Pack lunch for work instead of opting for the deli or the restaurant.  Not only will you save money but you’re in control of the calorie intake and how healthy your food choices are.   Don’t like sandwiches?  When you cook with the family, double up those recipes and make more than your family needs for just one meal.  Use leftover meals for lunches and freeze extras for future meals together.  Soups, stews, crock-pot creations all freeze well and will take the stress out of weekday cooking when there's a time crunch.  They travel well in lunch packs too.

• Have the kids pack their lunches for school as well and opt OUT of the prepared meals that are offered there.

I’ll bet my very last dollar that if you track your expenditures for a month before you start this process, you'll solve the 'Where does it all go?' mystery.

Just these few little adjustments in your regular spending routines will save you a bunch of cash to help get the dreaded Debt Monkey off your back.

If you’re tackling this goal on your own, count your blessings.  Your success depends on your efforts alone and you are totally in control.  As a kid, I watched my parents destroy their marriage over finances.  Exactly why this next step is so important. 

Step Four:  Get on the Same Page with Your Partner

We all know what we’re supposed to do regarding finances:  save more money, spend less money, put money away for the kids’ education, for our retirement, life insurance, a will, an emergency fund…yet so few of us actually do it.  

To break through that barrier it is so important to become clear about the values and goals that are a priority to both of you.   

If you’re one half of a partnership, here are some added tips and tricks for your success:

• Sit down, have a conversation about the values that each of you holds as important.  It is your values that will determine how hard you’re willing to work to achieve your financial goals, how much you spend now, and how much you’ll need to save for retirement.  Once the values are clear, the financial decisions become easy. 

• Set some financial goals together.  What does each of you want to achieve?  What do you need to achieve as a family?  It’s the beginning of the year.  This is the perfect time to take this step.

• Make it a game.  Brainstorm some ways to achieve your goals together.  Engage your competitive natures, if necessary, and see who can come up with the best ways to save or make more money for your household.  You are teammates and the goal is to win financially.

• Commit to the ‘No Credit’ rule.  Take it one step further even…agree to no purchases over a certain amount with a discussion.  This means that before any money is spent, the two of you will have a discussion about it and determine if spending the money fits in with the goals you've set out.  

Getting the Debt Monkey off my back once and for all was a life-changing, soul-freeing experience.  

Going through the process of slowly and methodically eliminating debt from our lives was one of the most rewarding, and necessary, life lessons.  It took dedication and commitment.  Every month that passed gave us more power - more money paid on debt and less money on interest. 

You can take your financial power back using this same method.  If I can do it, anyone can...and you can too.

When you set out to achieve big mountainous goals like paying off a mortgage or eliminating a massive student loan or a bunch of overwhelming consumer debts, the process is going to take some time.  

Changing habits can be a challenge.  

When you become clear about the values you’re following as a basis for the amazing life you’re creating for yourself and your family, you’ll become unstoppable in your goal to achieve financial freedom.

If you’d like help putting together a plan to get that Debt Monkey off YOUR back once and for all - along with a proven process on how to do it, contact me for a complimentary Ditch Your Debt Monkey Strategy Session and learn how YOU can be 100% debt-free.    

About the Author:

Andrea Raco, is a Certified Success and Life Enrichment Coach, Founder of Coach for Life and Curator of Gold Key Club ~ a private community for Ladypreneurs, Supermoms and Sisters making a difference in the world.

For more information about her programs and services, visit www.coachforlife.ca.