JegBeg

I mentioned a while back that I was trying to help my mother with her finances. Her major problem is one of debt. For years, she has literally lived on borrowed money and time. In my feeds today, I came across an excellent post at Dumb Little Man that details 20 or so guidelines for lifestyle changes and techniques for effectively diminishing debt. It covers all sorts of angles for attacking debt from living frugally to coming up with new sources of income.

Change your attitude: Like everything else in life, getting out of debt is heavily dependent on your attitude. Switch to a “Can Do” attitude. Stop giving into the victim mentality, or self-doubts of whether you can do it, or procrastination or whatever it is holding you back. Start attacking debt and don’t stop until its all gone.

While some of the tips seem a little contrived, I’d say this is a must read for anyone who is or wants to start working to eliminate their debt. I’m currently on track and seeing my debts dwindle. If I continue to follow good advice like that found in this post, I should be debt free (aside from the mortgage) in as little as 2 years!

The Consumerist brings us a funny article with their tongues planted firmly in cheeks. A fun play on personal finance tips list gives you ways to ensure you’ll never get ahead financially. Funny stuff.

“3) Impress Your Friends By Buying Them Expensive Stuff You Can’t Afford.

If Betty registers a $10,000 silver platter for her wedding… you should get it for her. Yeah, so you went in to debt? Betty is your best friend . She’d do the same for you. What? You don’t want to look cheap !”

The Consumerist via Digg

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I make no claims to being a financial expert or even a budget guru, but since I opened my eyes to the world of careful personal financial management and budgeting, my life has changed dramatically. In 3 years of using a budget, I’ve been able to buy a home, build significant savings, take a couple of vacations, and buy some toys. Because I’m proud of my success and have become a firm believer in the principles of personal finance, I periodically try to convince my friends and family to adopt some of the ideas, habits, and methodologies that I’ve had success with. I’ve even gone so far as to offer to buy financial software (usually my personal favorite, Microsoft Money) for the converts that promise to use it.

This morning I decided to put together a short list of links to good articles about getting started with managing money for my mother who has a serious spending problem and non concept of budgeting. Below is the list I gave her. It is by no means comprehensive, but (I hope) a good start for someone who has never been keenly aware of how to manage their finances. If you know of some good links that I’ve overlooked, leave them in the comments.

A Working Woman’s Guide to Financial Security

Track Every Penny

Budgeting for Non-Budgeters

How to Organize Your Finances in 4 Easy Steps

Why Frugality is an Important Part of Personal Finance

7 Ways to Take Charge of Your Finances

Living on $12,000 a Year

The Debt to Pleasure Ratio: What is the Cost of Fun?

How To Help a Family Member Without Loaning them Money

From Digg:
Zen Habits has a nice little article covering some of the free (as in beer) money management software options. As a avid MS Money user, I can’t say I’m ready to make the switch, but saving the $50 or so a year I spend on keeping Money up to date is pretty tempting. While I am leary of any web based money management software in this age of identity theft, some of the desktop solutions suggested here don’t sound bad. GNU Cash in particular is one I’ve suggested to some of my friends that are less hip to the personal finance management game. Good stuff.

-J

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Personal finance blog Get Rich Slowly is running a great article describing a simple methodology for getting a handle on your finances. For most of us already obsessed with finance, most of this is not new. However, they do describe a  debt reduction technique I’ve never come across before:

Pay off the debts starting with the smallest balance first. Here’s how:

1. Order your debts from lowest balance to highest balance.
2. Designate a certain amount of money to pay toward debts each month.
3. Pay the minimum payment on all debts except the one with the lowest balance.
4. Throw every other penny at the debt with the lowest balance.
5. When that debt is gone, do not alter the monthly amount used to pay debts, but throw all you can at the debt with the next-lowest balance.

This goes against the conventional wisdom, which says to pay the highest-interest debts first. But the debt snowball can give you awesome psychological payoffs, keeping you motivated to eliminate all your debt. It works for me.

Pretty good stuff. I’m lucky enough to not have too many debts that need to be prioritized. But, for someone who’s deep in the hole with several debtors, this could work. Let me know of any debt reduction techniques you use in the comments

7 Ways to Take Charge of Your Finances in 2007 - Get Rich Slowly 

-J