Divide Your Cash To Pay Your Debts
Filed under Debt Management
Its payday again. Isn’t it fun to think on how to spend that extra money that you have worked for? Let’s say you received that extra money from your second job. Isn’t it very tempting to spend it on something that you’ve been wanting for a long time. After all you deserve it. But perhaps you’re a sensible person. You tend to spend some time thinking how you can spend that money wisely, such as on something that is really a need and not a want or desire. While it isn’t a bad thing to spend on what you want, the key is to do so in moderation.
Here’s what you can do: divide your extra cash into three parts and allocate each part for a certain purpose.
A third of your money you can allocate for paying your debts. Use the money for paying your monthly bills and utilities, or use it to start paying off your credit card balances. Don’t hesitate to pay for what you are obliged to pay for. The extra money can help you get out of debt, or at least reduce your debts.
Another third of the extra money you can allocate for the rainy days. You can put this money in a savings account. You further divide this amount and allocate the amount to your silo fund, which simply refers to the fund you devote for your vacations, recreational activities or purchasing special items, like gadgets. When you save this portion of extra money, you’ll be able to use it for a purpose in the future.
The remaining third of the extra money is all yours to use however you want. Since you’ve allocated a portion of your extra money to paying your debts and for the rainy days, you can use the other third of the extra money to pamper yourself. Why not take give yourself a day at the spa, take the family out to dinner or maybe buy yourself that designer bag? Then again, if your conscience gets the better of you, why not put that in your savings?
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