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Justifiably Finals...

Its that time again folks! The entire semester is culminating into one week and after that week SWEET MERCIFUL FREEDOM! Well until Summer semester starts up again. But don't head off to the bars just yet to celebrate your inevitable success on this hellish week.

We make informed purchases, budgeted purchases under normal circumstances, but through in a handful of stress and those well-mannered shopping skills get thrown away. They are inevitably replaced with "justified" purchases.

A "justified" purchase is when you compromise your budget or your plan to allow certain outside factors to infect your spending trends. I stayed in all week and ate only ramen... I'm going out this weekend and having fun because I saved so much money! While I'm the number one supporter of having fun, spending money to reward yourself for saving is a recipe for disaster. You save money during the week, you spend most of what you saved over the weekend, you wake up monday and feel like a failure.

And when you feel like a failure, you --unfortunately-- begin to act like a failure. I spent all the money I saved, gosh I feel bad... Starbucks! That'll cheer me up. And quickly your "justified" spending over the weekend leads way to more "justified" spending. I've already failed at saving, won't matter if I buy this grande cinnamon dulce latte with extra whip... I've already failed. And pretty soon you've compromised your budget completely nearly undoing everything you've saved for.

Mind you, this is an extreme example, but to tell you the truth, this is how I was just last year. I didn't have a handle on my finances. I was more comfortable with feeling horrible about my three or four overdraft charges eating up my paycheck and wasting the rest away on spending that didn't help me at all, than sitting down and getting my act together.

Money is a scary thing. When you have it, you want things. When you don't have it, you want more things. When you've never had it, you want very little.

The very little being the bare necessities: food, shelter, utilities, etc.

So if you were able to relate to past me, in my above upper monologue, than you need to make an executive decision: continue justifying your failures and pay the bank or start making a plan to pay yourself.

My failproof plan for paying yourself:
1.) People with less, want less, or at least want on a smaller scale. Take care of your basic living essentials (basic does not involve catalogs, websites, or the mall) first. Perfect your budget so you are only buying what you need instead of what you want.

2.) Sit down with your credit card bills and your debt and make a plan. The snowball effect works wonders, sets your balances up to be paid highest interest first. Read my first posts.
You may be fearful of where to start, don't worry, being overwhelmed is a sign that you're on the right track. I was fortunate enough to be in a position where I could pay a little to each debt monthly until my little bites turned into complete gobbles. Going from eight debts down to two has been a great achievement of mine, so I know that eliminating debt will make you feel wonderful about yourself. ITS TRUE! YOU'RE NOT A FAILURE!

3.) Eliminate justified thinking. I think that the savings gurus have been too far gone from the days of wallowing helplessly in a debt cycle to truly understand how people will react when they say "treat yourself... you've done a good job!". While I'm all for positive reinforcement, I think that "treat" should be defined and should be an informed decision. Treating to the gurus includes: going to the movies, buying a new shirt, going to the coffeehouse, buying ice cream, etc... But honestly, those are all things that could be detrimental to a budget or plan when taken from a justified purchase state of mind. Going to the movies does not mean go to the movies with three of your friends and buy a combo a piece. Buying a new shirt does not mean designer label. Coffeehouse does not mean the largest size most expensive drink with a pastry on the side. Ice cream... well that one might be safe. The point is you've been going at your saving from an informed state-of-mind, make sure that any "treats" you feel you've earned are still within that state of mind. No sense in setting yourself backward so you can have that new Coach bag.

4.) Whatever is left over after paying for your bills and contributing to your debt, should be cut in half. Use one half to pay yourself by depositing into your savings account, the rest to spend on your basic essentials (food, clothing, school etc.) If its not enough money than you have two options available: Make more money or Spend less money.

It may not be failproof and it may not work for you, but its my plan and I'm done settling and I'm happy paying myself.