This is my first regarding frugal living and babies (my first child is due this weekend). I am incredibly excited and nervous (see my previous post, Loose Change). Not a bad nervous; more of a ‘What should I expect?’ nervous. As such, you will not hear from me for a short while but I promise to be back soon. Keep checking back and writing comments.
Before I go, I do have a frugal living idea to share with you regarding the preparations that I have made leading up to the delivery. I have quickly learned that baby ‘anything’ is really expensive and it all seems to run on batteries. Being my first child, there are a lot of unknowns that lay ahead (except inflated ‘baby’ prices – of this I am certain). As with all unknowns, I feel that it is always a good idea to have a little cushion in case things end up costing a lot more than you hope (which they always seem to do). In order to address this, I have been increasing the percentage of my income that I save over the past few months. As it stands now, I have some extra cash on hand for the inevitable extra expenses. I find this quite reassuring.
The mistake that is often made is to not do this thinking that you can just charge it to your credit card and worry about paying for it later. Now, I love the free benefits that using my credit cards give me (a cash rebate based on a percentage of my yearly spending on one, free Air Miles on the other) because I pay off the full balance of my cards each and every month. I get my benefits for free, or rather, my benefits are paid for by the people who carry monthly balances. I’ll come back to the incredible dangers of revolving credit card debt in more detail in the near future, for now, it will suffice to say that using a credit card as a back-up or an emergency fund is not normally a good idea, and it can get incredibly expensive.
Paying exorbitant interest charges each and every month is incompatible with frugal living as it reduces your ability to put your hard-earned income to other more beneficial and enjoyable uses. Eliminating high-interest debt is a crucial first step towards enjoying the pleasure and fulfillment that are a part of frugal living. If you do have high-interest debt, consider earmarking a dollar amount of each pay directly towards gradually paying it off. If it comes off automatically as soon as you get paid, you won’t even miss it. It will help you take on all of the unexpected surprises and the underestimated expenses that are a part of life. This is one of the wonderful benefits of frugal living.
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Please check back soon.