Just a few short decades ago, adults didn’t have very many monthly bills. Typically they had a mortgage, electric, heating of some kind, maybe phone and water. Do you feel as if you can’t get ahead? As if all your money is gone each month before you ever see it? The chances are good that you have many, many more monthly bills than your grandparents did.
I have made it my goal to minimize our monthly bills. Still, we have more than our grandparents did. Mortgage, phone, Internet, cable, gas, electric, credit card (we pay it off each month) and we also have quarterly bills of water/sewer and trash. Because I try to keep our monthly bills to a minimum, we have less than most people.
Think of all the options we have compared to our ancestors. All these wonderful advancements in technology come with monthly payments. Cell phones, Netflix, Blackberries, home alarm systems, and many more. We also now pay for trash pick up. There are also other monthly options such as online games, DVR or TiVo, satellite radio, gym memberships, house cleaners, and more.
Combine all these monthly payments with debt payments and your income isn’t going to go very far. Our grandparents didn’t borrow money for the most part. Now we have car payments, credit card debt, student loans, HELCs, medical bills, personal loans and more. The number of monthly commitments our money has will automatically affect how much money you have to save each month. Some people have so many monthly commitments that they don’t have enough money to cover them all.
I firmly believe that if anyone wants to truly get ahead with their money and get their family on firm financial ground they have to minimize their monthly payments. This frees up money for savings, it allows you to pay cash for things that you need (new car) and gives you the cash to handle emergencies, or even little things that pop up from time to time without having to stress or go into debt. Have you looked carefully at your budget to determine what monthly payments you can cut out?