Note: This is a post from Adam Baker, founder of Man Vs. Debt.
We talked about our obsession with the debt-fueled life path and how it’s keeping millions trapped.
But talk is cheap.
I’m much more interested in action.
And this week, I want to do my part to shatter any excuses or justifications you may have. Below are 24 different actions that can be done this very day. Most are really quick (as quick as a few minutes) and others will require a chunk of your evening after the kids go to bed.
I took the time to provide 24 different options. For pete’s sake, you can at least do one of them. Can’t you?
Sure, there’s little chance all will be viable for your situation. Some you’ll already have done.
I’m asking for one. Just one.
Action #1: Pull Your Credit Report (10-20 minutes)
- Visit Annual Credit Report – Visit annualcreditreport.com. Do not use other scam sites.
- Follow this tutorial step-by-step – Rather than rehash every detail here, I’ve provided screenshots for each step along the way over on Get Rich Slowly (as a guest post). Click here to see the guide.
- Quickly check your report over for errors – Over 2/3 of credit reports have some sort of existing error (many are very minor, but some can be large!).
- Store a copy of your report in a safe place – You can use your report to reference all sorts of information in the future, including listing every debt you owe, following up with errors, or when applying for different services.
- Monitor your scores using free tools Credit Karma and Credit Sesame – Both give you a credit bureau specific score you can use to monitor any changes. Credit Karma gives you TransUnion’s score and Credit Sesame gives you Experian’s National Equivalency Score.
- (optional) Check your credit score: – You can take advantage of a free trial of MyFICO, run by Fair Isaac (the company that invented the FICO credit score), to get your score for free. This step is entirely optional, it’s good to know your score but it isn’t as important as checking your credit report.
How this can change your life: When we first pulled Courtney’s credit report, we were saddened to find she was a victim of identity theft. We had better luck with my credit report, however I did discover a $200 collections account I didn’t even know existed! Fixing errors like these is the fastest way to improve your credit score – many people go years and years without ever pulling their reports.
Additional Resource: How to Get Your Free Credit Report Online: A Step-by-step Guide
Action #2: Employ the “Clean Slate” approach to your clutter (20 – 90 minutes)
- Pick a room, area, or desk drawer – Pick a single, specific area. Your closet, bedroom, kitchen, office – or even the top of your desk or a “junk” drawer.
- Remove everything out of the space - Everything… that’s why it’s called “Clean Slate”. Move it into another area or room.
- Go item-by-item - Ask yourself not “Should I get rid of this?” but instead “Does this item add joy, value, or purpose into my life?”… ”Do I really need it?”. If yes, move it back into the room.
- If no, put it into one of three piles – Put it either into SELL, DONATE, or RECYCLE piles. After you’re done with each item, sell the SELL pile, donate the DONATE pile, and recycle the RECYCLE pile. Duh.
How this can change your life: Clutter slowly sucks away more of our time, energy, and money. By attacking specific areas where it tends to collect you can reclaim back pieces of these resources. For most people, selling excess stuff is the #1 way to generate extra cash quickly. This process is also addicting and can lead you down a rabbit hole that may just end in an organized and clean living space. Gasp.
Additional Resource: The ‘Where to Sell Your Crap’ Flowchart
Action #3: Get 1 paying client (15-35 minutes)
- Brainstorm a specific need you can fill – Can you cut grass? Shovel snow? Walk dogs? Provide computer training/support? Tutor? Teach English? Consult on a topic?
- Write out three clear benefits to working with you - Pick three BENEFITS of what someone would get out of working with you. BAD: I’ll cut your lawn. GOOD: You’ll have a freshly trimmed, clipping-free yard by the time you get home. Three benefits.
- Brainstorm 5 people who could use those benefits - 5 people. Likely whom you already have some relationship with (or know through someone). Quickly list them out.
- Call the most likely candidate – Pick one that’ll especially need your benefits. Call them. Explain who you are and list out the three benefits of them hiring you. Then… just ask.
- Continue down your list until you have 1 client. If the first doesn’t work, try the other 4 – one at a time.
How this can change your life: The biggest mistake most people make in making more money is that they do TOO much planning. Your facebook fan page, twitter profile, and even your blog aren’t a tenth of the value of your first paying client. You’ll learn more in this process than you will in years of tweeting. I promise.
Additional Resource: Examples from the Field: How to Stand Out
Action #4: Do something incredibly nice (and free) for your spouse (5-20 minutes)
- Brainstorm a free gesture or activity – Plan something fun, cook a nicer-than-normal dinner, record a song, write a poem or letter. There are thousands of ideas online at your fingertips. Base it on what they value/love most.
- The next time you see your spouse, surprise them. - It’s really as easy as that. Use your brain and heart instead of your wallet this time. :-)
How this can change your life: All too often, I find myself getting stuck in the “oh I forgot to do something nice for Courtney… let me buy XYZ or get XYZ thing.” The easiest solution is to simply buy something. Quick and painless most times. But gifts and actions of the heart and mind often mean many, many times more. They are often just as easy, once you take the time to actually start brainstorming. Try it. You may find out that a happy spouse doesn’t always require spending.
Additional Resource: 74 Simple Things You Can Do to Brighten Your Spouse’s Day (many free)
Action #5: Freeze Your Credit Reports (20-30 minutes)
- Decide if a freeze is right for you – A “freeze” will restrict new creditors (and identity thieves) from being able access your reports. You can easily lift a freeze (should you want someone to access your reports), which takes anywhere from 10 minutes to a couple days. Some states have a small cost to place a freeze, others are free. Free reports are given to senior citizens and victims of identity theft in most cases.
- Freeze with TransUnion Online - Click here.
- Freeze with Experian Online - Click here.
- Freeze with Equifax Online - Click here.
- Call customer service if needed – Most of the time, freezing will be just a few click away online. If you have problems, call - TransUnion: 1-888-909-8872 – Experian: 1-888-397-3742 – Equifax: 1-800-685-1111
- Turn down any upsells – Unfortunately, customer service may try to sell you on additional services. Just state you would like a “credit report freeze” only.
How this can change your life: A credit report freeze is one of the best ways to lower your exposure to identity theft. Many sources report that the average time spent fixing an identity theft case (by the victim) is over 150 hours. Need I say more?
Additional Resource: How to Freeze Credit Reports Online
Action #6: Draft your first budget (25 minutes)
- Estimate your income – Round down whenever possible to convenient numbers. If on extremely inconsistent income, start by budgeting based on last month’s income. That’ll never change.
- Brainstorm fixed expenses - Brainstorm your fixed, regular expenses. Those bills you pay every month. Round these up to convenient numbers. Don’t worry about being perfect – get as many as you can.
- Brainstorm irregular expenses - This is the hardest part for most people – and where most budgets fail. Think ahead to any non-regular expenses or bills that are coming up in the next 30 days. Gifts, repairs, holidays, supplies, taxes, etc…
- Accept that you are going to fail miserably – Do not try to be perfect. Round income down and expenses up. Give yourself fluff room. Next time, at least you’ll have a base with which to start and adapt. Simplify when possible. Take notes when things come that were unplanned.
How this can change your life: The toughest thing about the budgeting process is just getting started. People try to spend hours creating their first budget – perfecting every single category or angle. Formula for failure. Take 25 minutes and complete as much as you can. Next week, revisit it for another 25 minutes. It’s only as hard as you make it.
Action #7: Track your spending all day at point of sale (5-10 minutes)
- Get paper and a pen – Fold a piece of paper until it fits into your pocket – or find an unused small notebook.
- Jot down each purchase you make, when you make it - At the point of purchase, quickly write down the item and the amount you spent. Feel free to round up to the nearest dollar or whole number.
- At the end of the day, review your list - Check it over with a spouse or partner. Did you forget anything?
How this can change your life: Tracking your spending (along with budgeting) is one of the most high-leverage financial habits you can form. The act of writing expenses down will be a powerful jolt of consciousness into your spending. If you can do this simple task for one day… why not 30 consecutive? You’ll have great data to budget with – and even more insight into your habits.
Action #8: Use Cash Envelopes for Food, Clothing, “Blow Money” (20 minutes)
- Pick your spending limits - For the categories “Food”, “Clothing”, and “Blow Money” (guilt-free entertainment) – pick a maximum amount you are willing to spend over the next 30 days.
- Stop by your bank and withdraw cash - Of course, the cash is equal to the combined limits you set for the three categories.
- Stuff envelopes with the cash - Get out 3 envelopes. Write the name of the category on the outside, and stuff the appropriate cash inside the envelope.
- Pay with cash – For the next 30 days, anytime you want something in that category – you’ll pull out your envelope and pay with cold, hard cash. Yes, I’m serious. You don’t have to carry them around at all times. When you go to the grocery store – take your Food envelope. Again, this isn’t rocket science.
How this can change your life: There is no budgeting trick or technique that is more powerful than going to pay for $60 in groceries and only having $45 in the envelope. I promise, the first time you put back $15 in items – your commitment to budgeting will never ever be the same.
Additional Resource: Dave Ramsey’s Envelope Budgeting System
Action #9: Start a “30-day” list (2 minutes)
- Pull out a piece of paper and pen – Pretty self explanatory. Write “30-day” list at the top.
- Write impulse desires on the list - The next time you want an iPad 2, new purse, video game, television, online subscription, etc… you’ll first write the item down on the list (along with the date).
- After 30 days on the list, revisit the item - After 30 days have passed for each item, ask yourself – do I really need this item? Is it the best way to spend my money in accordance with my goals and values? If yes, then buy it.
How this can change your life: For most of us, our weakest moments are just that… moments. It’s the new shiny gadget, the review we just read, the window we walk buy, or the webpage we just landed on. Separating ourselves from our desired purchases even 72 hours will nip most impulses in the bud. Do it for 30 days? Well, it’s the best method I know at ensuring you spend on only those things you really do want.
Action #10: Automate a large, regular bill (5-15 minutes)
- Select a large, regular bill to automate - Pick one that you always plan for and know is coming anyway.
- Log onto your online banking website - The far majority of banks now have “online bill paying” or “pay bills” as features. Walk through the individual process for this one single bill. If in doubt, call your bank.
- Mark the automatic transfer on your calendar – Mark the automatic transfer down the day before it is set to go out of your account. This will get you used to the process for the first few times (and ensure you don’t bounce the payment).
How this can change your life: First let me say that you should only automate bills when you are in a positive financial situation. Automate a bad financial plan – and you get more of a bad financial plan (with less control). That said, automation can be a powerful tool once you get on the right track. Just going through the process once, will give you the confidence to automate more and more of your routine financial tasks (and focus on more valuable issues).
Additional Resource: Ramit Sethi’s Automation Strategy
Action #11: Cancel your cable (15-20 minutes)
- Call Customer Service – Look on your last over-priced bill and call your cable company.
- Tell them you’re calling to cancel - Do not yield, they will be trained to talk you into staying. (sound familiar?)
- Ask for a confirmation number or code - Before hanging up, get a confirmation code or number that verifies your cable has been cancelled. Write it down.
- Throw your television out the window – Just kidding, checking to make sure you’re really reading. Keep your television for movie nights – or to watch your favorite one or two series via DVD, Netflix, or the internet.
How this can change your life: Just as debt is the default life path for so many of us – television is the default form of mindless entertainment. Look, I don’t hate television – I just know what happened in our life once we stopped defaulting to it every night on the couch. I still watch a few favorite shows, games, and events from time to time, too.
Additional Resource: 11 Reasons to Ditch Your Television
Action #12: Start your emergency fund (20-40 minutes)
- Walk into your bank and open an account – If you don’t already have a separate savings account, open one. Make sure it’s separate from your normal process.
- Fund it with whatever you can - $20, $25, $50 – your bank may have a minimum, but many are set up to encourage savings accounts and their limits will be low. You don’t need $200 to start!
- Commit to $50 per month - Or $100, or $20, or $250. Pick something you know you can make room for and transfer it as soon as you get paid every pay period. Throw any extra small income chunks or bonuses into this fund!
- Celebrate vigorously at $1000 – Even if it takes two years, celebrate achieving your first $1000 emergency fund. This is a great place for most people to start – and now it’s time to attack our next most important financial goal.
How this can change your life: A $1000 emergency fund is the most important financial principle you can instill in your life. Having this fund will radically change your relationship with money. You’ll sleep better, build confidence, and be able to sustain momentum in the event of a true emergency. I can’t stress this enough – start here (if you don’t have one yet).
Additional Resource: 11 Ways to Spice Up Your Emergency Fund
Action #13: Create one single product from scratch (15-45 minutes)
- Select an everyday product you use regularly – This could be anything from shampoo, to laundry detergent, to clothes, to gifts, to… you get the point.
- Find a great tutorial online - Google: “How to make [YOUR THING] from scratch at home”. Your answer will be on the front page 9 times out of 10. Skip eHow if you can and find a real person or blogger with a tutorial.
- Follow the step-by-step directions - Just like you are doing here – except over there.
How this can change your life: Resourcefulness is one of the traits I respect most in people – and one of the ones I struggle with most. The simple act of creating one gift, product, or gadget yourself (at home) can really change your relationship with buying new things every time you need something. Some people take frugality to extremes, but almost all of us could benefit from some ole’ fashioned resourcefulness.
Additional Resource: Trent Hamm’s “Do It Yourself” Rule
Action #14: For one day this week, take alternative transportation (10-45 minutes)
- Pick a day of the week – Today would be great, but if not… what about tomorrow?
- Take an alternative form of transportation for the day - Take public transportation. Walk. Bike. Call your buddy up and car pool (you get to ride in the cool lane legally this time!). Switch it up.
How this can change your life: Most of us aren’t willing to explore possibilities unless we are challenged. In New Zealand, I could have never imagined enjoying riding the bus. But I loved it. It gave me time to think, work, or relax – without being stuck in traffic and stressing out. You may find that biking to work on nice days is a possibility after all. Or that carpooling may save you gas, repair costs, and give you social interaction. :-)
Additional Resource: Tammy Strobel’s Rowdy Kittens Blog
Action #15: Intentionally negotiate something (10 – 25 minutes)
- Pick your target – Maybe there is already a new product or service you are in the market for. Otherwise, cable bills, credit card interest rates, and medical bills are always good targets. As a last resort, go find a local flea market.
- Call, approach, or visit your target - Call customer service or drive to the location of the item/service.
- Politely, but firmly ASK for what you want – Ask for a lower interest rate, ask for a discount on the portion of your medical bill not covered by insurance, ask for 40% off a service or item. What’s the absolute worst thing that could happen? Seriously?
- Walk away/hang up – Always be willing to walk away, there’s nothing wrong with that. If they can’t help you, hang up the phone. There… it’s over. You can breathe again.
How this can change your life: Negotiating is one of the most important life-long financial skills you can build. I’m not talking about the cheesy, take-advantage-of-people, type of negotiating.
Additional Resource: 27 Simple Ways to Become a Better Negotiator
Action #16: Cancel An Unused Credit Card (15-20 minutes)
- Call Customer Service – Turn your credit card around and call the number on the back. Alternatively, Google the customer service number.
- Tell them you’re calling to cancel the card - Do not yield, they will be trained to talk you into staying.
- Ask for a confirmation number or code - Before hanging up, get a confirmation code or number that verifies your card has been cancelled. Write it down.
- After 60 days, verify it’s been canceled – For extra security, pull your credit report and ensure it’s been closed. Recall customer service if needed. Provide confirmation code. Send a certified letter if they request it. 9 times out of 10 the first call will do the job – these are just extra steps to help in rare cases.
How this can change your life: Sure, canceling an unused credit card can temporarily lower your credit score. However, Courtney and I found this first process so empowering – we decided to cancel the rest of the credit cards in our life, as well. With no credit cards we are much more conscious of our spending, worry less about identity theft, miscellaneous fees, and account changes. By the way, our credit score has gone up since we canceled all our cards. Just pointing out a fact.
Additional Resource: I know this is a controversial topic. Here’s a break down of the pros and cons of canceling a credit card that I wrote over two years ago. Read this for more perspective.
Action #17: Arrange a coffee or lunch meeting with a person you look up to financially (5-10 minutes)
- Brainstorm 3 people whom you respect when it comes to money – Don’t pick people who “seem” rich – this can often be an illusion. Pick people who you know have solid financial habits – or even better – people who’ve recently turned around a bad situation.
- Ask them to meet you for coffee or lunch - Call them up and be 100% honest. Tell them you respect how they handle financial issues and were wondering if they’d spend 20-30 minutes mentoring you on how they got started.
- Create a list of questions - You don’t have to read from a piece of paper – but it’s important to plan out some great questions to ask during the conversation. Ask about their personal experience and do 5 times as much listening as you do talking.
How this can change your life: Finding and surrounding yourself with positive influences is absolutely key to accomplishing any financial goal. A mentor that can help you with both inspiration and advice will be invaluable to you as you proceed.
Action #18: Understand your “Big Why” (15-20 minutes)
- Watch this video – Yes, that’s my video – and yes I think it’s awesome. Watch the full thing, first. Alternatively, find someone who helps inspire you to go deeper with your reasoning.
- Download the worksheets - To the right of the video, there are worksheets with examples. Download, print, and fill them out.
- Tape your “Big Why” on the refrigerator - Once you have a clear, emotional answer to what really motivates you (deep down) – paste it on your refrigerator. Heck, put it in front of your computer or on the wall of your bedroom. Anywhere that’ll remind you.
How this can change your life: All the step-by-step instructions in the world won’t help you – unless you’re clear about what is really driving the change or goals. All to often, we stay at the surface. We don’t just “want more money” we want what the money will bring us. Going deeper will provide you the extra momentum to overcome the dips in the journey.
Additional Resource: Understanding What Really Motivates You (Deep Down)
Action #19: Read 3 chapters from a personal finance book (25-45 minutes)
- Find a book that most closely speaks to you - Read reviews, websites, or pick from my suggestions below.
- Buy, order, or borrow the book - It’s ok to pay for education. However, you may be able to borrow these books from a friend or your local library. However you do it, obtain the book!
- Pick 3 chapters to read in full – In one sitting, pick three of the chapters that seem interesting and read them.
- Take notes – What down what you think or feel when reading. What lessons can you apply to your life? Does this resonate with you?
How this can change your life: My life has been changed many times on the account of digging into a book. Courtney’s and my journey started with a couple books and a few select blogs. Again, surrounding yourself with positive influences (both human and informational) will immerse you in motivation to keep chugging ahead.
My top three personal finance books:
Action #20: Write a letter (or email) to yourself (10-15 minutes)
- Fetch a pen and paper – You likely already have this on hand from past action items.
- Write a letter forgiving your past self for financial mistakes - Specifically forgive yourself for all your past financial mistakes. Mention details if you need to. Express your true frustration and feelings – and then forgive yourself.
- Open up the letter and read it - The next morning open your letter and read it.
- Burn it in a fun (but safe) way – Rip it shreds, light it on fire, give it to the cat to play with. Destroy in a fun, safe way and part ways with the guilt.
How this can change your life: I’ve talked to a lot of people about their financial issues – and one of the most recurring themes is regret and guilt. While it’s important to acknowledge that past habits and decisions have had less-than-desirable outcomes… dwelling on them does no good. One of my favorite quotes is “Even God can’t change the past”. From this day forward… that’s what you can control.
Action #21: Update your resume (15-30 minutes)
- Find your most up-to-date resume – Some of you may have that on hand, for others it may have been a while since you used one.
- Update the personal information - Start by ensuring all your personal data is up to date. Address, phone number, years, etc…
- Update job history/duties - A little more difficult is going back and updating any new job history – and refreshing the job duties/responsibilities section.
- Update references - Are these still the best references to talk about your talents, experience, and work ethic?
- Revisit your copyrighting – Over every part of your resume, revisit how you describe the tasks, duties, responsibilities, and talents. Often times, if I take a break from something (especially for a long time) – I’m able to immediately make drastic improvements when I revisit it.
How this can change your life: Having an updated and fresh resume on hand will allow you to quickly jump on any potential opportunities that may come up. It doesn’t mean you’ll be able to quit your job just yet, but it’s the first step in taking initiatives in that direction!
Additional Resource: SquawkFox Resume Series
Action #22: Pledge to volunteer one full day next week (10-20 minutes)
- Research local volunteer options – A quick Google search (or call to church/friends) will turn around dozens of opportunities to give back.
- Schedule a specific date/time - Clear your schedule for one day and pledge yourself to that organization for the day (bonus points for pledging your partner and kids, too!)
- Show up ready to give back! – That’s it.
How this can change your life: Our society makes a big business out of blurring the lines between our needs and our wants. If we aren’t careful, we can lose appreciation for exactly how fortunate and blessed we are. Giving back, especially to the underprivileged is an amazing way to come face-to-face with these facts. It also builds up your community and helps set an example for others to give back.
Action #23: Sleeve your credit/debit cards (10-20 minutes)
- Pull out all your credit/debit cards - Dump out your wallet or purse and pull out any cards you commonly use.
- Tape a “Big Why” reminder around them - You can wrap them in a piece of paper (a paper sleeve of sorts) and write your “Big Why” or some other pieces or motivation on the outside. Even better, tape a picture of your kids or photo that represents your goals to the front.
- Every time you go to make a purchase, pause – Whenever you go to pull out your card to swipe for a purchase, pause and reflect at your writing or picture. Does this purchase support that?
How this can change your life: The downside of the convenience of credit and debit cards is that they make our spending unconscious. Many people – myself included – get into habits of swiping without realizing what’s going on. The ability to pause – even if for a few seconds – and be reminded of your financial goals and motivation can completely change your daily spending habits.
Additional Resource: Sleeve Your Credit & Debit Cards to Fight Impulse Spending
Action #24: Be happy (30 seconds)
- Recognize when you are in a bad mood – The first step is to realize when you are frustrated, depressed, stressed, or upset.
- Establish a silly gesture, pose, or thought - Find something completely outrageous that you can do to “break” your current state of thinking. Physical gestures, actions, or celebrations are the best at this.
- Jump on one leg and scream like a monkey – Execute said gesture.
- Stop being so pissy – A positive attitude is a choice.
How this can change your life: Study after study has shown than people are weakest financially when they are in crappy moods. Many of us resort to buying to fill temporary holes in our attitudes (much like food). Establishing a silly gesture that helps break you out of your rut can help you avoid your most vulnerable financial states.
Additional Resource: Gretchen Rubin’s The Happiness Project Blog.
Remember, you don’t have to do every item on this list.
Pick whichever ones stand out – and knock them off the list. Start small. Start with one.
You have the time… it’s up to you do it.
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Now get into action!