As is true with most people in this country, there is constant upward pressure on the price of everything I purchase but my salary remains about the same as it was 10 years ago. How long can this possibly continue to be the case? It’s no wonder that gold and silver keep hitting new highs on a regular basis. But my question is how long can things keep going up without wages moving?

Anyway, the only thing I see that people can do is finding ways to cut their expenses. I’ve already dropped my cable package down to the basic channels, cancelled my home phone and reduced my cell phone plan to the smallest package. I also recently replaced my flip flops with a pair of orthotic sandals in hopes that it will help my hips and back feel better and I can cut down on trips to the chiropractor. So far they seem to be working, I think my back problems may have been partially from not having good support in my shoes!

I Hate Insurance Premiums!

Now I’m looking through my insurance to see where corners can be cut. I was on a site that talks about term vs whole life insurance to see taking the cash value out of my permanent life insurance and buying a 20 year level term would make sense. I’m 45 so in 20 years I will be retirement age and will hopefully be debt free so I won’t need a lot of life insurance coverage.

Speaking of debt, the other place where I can see there is lots of savings to be had is the amount of credit card interest I pay. It doesn’t seem like a lot when you see your monthly statements but when I added up each of those monthly chares for all 3 of my credit cards it was a shocking number ($1245)!!! I did some online research and uncovered a technique on how to get out of debt for using balance transfer offers and focusing on paying down your smallest balance first. It’s similar to the debt snowball plan that I’ve heard on Dave Ramsey’s show but it takes it a step further. By getting the interest costs as close to zero as possible it frees up lots of cash that can then be used to pay down debt. I have a friend who used this technique to go from $20000 in credit card debt to zero in just two years. That’s pretty fast when you think about it.

Anyway, since my wages are stuck for now I’m going to keep driving my costs down until I have enough free cash flow to pay off my debts. By getting rid of expenses it will be the equivalent of a 10-15% pay raise and I’m not missing any of the things that I cut. I’ll give you an update on my progress in a few weeks!