Unexpected Ways to Save While on a Debt Management Plan

My Journey out of Debt

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Unexpected Ways to Save While on a Debt Management Plan

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Unexpected Ways to Save While on a Debt Management PlanI know what most of you are saying after reading the title of this blog.

In fact, I know I have said and thought the same exact thing: "I am doing all I can to make my monthly payments for Debt Management?", "How do you expect me to save when I live paycheck to paycheck?" or, "I have heard it is better to pay off your debt before putting money in savings."

Which is it? Debt or savings?"  The answer is both!

It has taken me a while to realize that you can do both, and that saving doesn't necessarily mean putting x amount of dollars into a savings account.  The most unexpected way I have learned to save is to look at the various benefits I receive through my employer.

Invest in your future - a no-brainer

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The nonprofit organization I used to work for offered a 403(b); my current company has a 401(k) plus a profit sharing type of program.  Okay, I admit this may not be unexpected, but you would be shocked to realize how many people are not contributing that much toward their retirement, simply because they don't understand how these investments work.

The bottom line is that once I finally took the time to learn what options were available to me, taking advantage of them seemed like a no-brainer.  I may not be able to put money into a savings account, but by enrolling in my company programs, I am still accruing a nice account for retirement. 

Sure, in most cases there is money coming out of your paycheck, but if you start it as soon as you are eligible you won't even miss it. You don't have to worry about spending money before you save it...you just contribute and forget about it.  Whether it's $25, $50, or $100 - whatever you can do - do it. 

Once I started I was amazed at how quickly it grew, and it isn't something that I can get my hands on and spend.  It is just there.  At first, it seems a bit overwhelming and some of the "terms" are difficult to understand; this article helped me out with some of the basics.

But wait, there's more!

Don't forget about some of the "other" benefits your company may offer.  If you are working full time or even part time, chances are your company has affiliations through your corporate benefits provider and related, that give you access to savings on miscellaneous services.  Some examples can be reduced gym costs, and discounted prices for massage therapy. Much of this can depend on your industry.

In addition, they may have other programs that seem like a waste of money, but in the long run could really help you. For example; my company just started a program that for $13/month covers our household appliances under warranty.  How can I not take advantage of that? All I pay is a $50 co-pay for someone to come fix or replace my broken washer or dryer instead of hundreds of dollars without the warranty?  I'd be crazy not to.

Don't be so quick to pass up benefits that you may have to contribute to, explore them first.  Talk to your human resources or benefits representative and ask.  If you haven't been paying attention, you may have missed something new.  Something that can help you save while getting out of debt. 

Related Posts:

A Penny Saved Is A Penny Earned

A Creative Way To Save A Buck

Debt Free Retirement 

Katie SimmonsKatie (Simmons) Lupo

Katie is currently enrolled in the CareOne Debt Relief Services Debt Management Plan (DMP). You can read more about Katie's experience in the My Journey out of Debt blog. In her blog, Katie explores life without credit cards, living on a 'real' budget and making that adjustment from spender to saver. A newlywed, Katie candidly addresses how debt has influenced her choices in love and life. Look for older posts by Katie under the Single and Settling In blog. Compensated Blogger for CareOne Debt Relief Services.

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  • You should ALWAYS have savings in the form of an emergency fund that is LIQUID. If you don't, you'll need new tires for the car, and have to put the bill on your credit card, thus increasing the debt you're trying to pay down.

  • This advice is moronic.

  • I agree wtih Tara.  While the advice will work (if you put money into savings, it will be saved) it's simplistic and... yes, I suppose moronic. Spending $13 a month for appliance insurance is ridiculous.  Most of your appliances have life spans of 5-10 years, and will spend a good chunk of that time under various other warranties.  Putting $13 a month into savings, rather than buying "insurance" means you can easily pay for a service call or *gasp* buy a new unit when you have to.  Blindly socking money away into your company's 401k is silly unless you know what you're investing in.  The default options are usually overly cautious indexes that grow at ridiculously small rates (the price you pay for caution) but still dive when the market takes a tumble (the price you pay for investing).  Years of growing, even with the miracle of compounding, at only a few percentage points per year is quickly wiped out by a 10% correction over the course of a few months, leaving you to spend several more years slowly growing just to reach where you were.

  • @Max thanks for the comment and I just did a post on the very important emergency fund, hope you can check it out!

  • @Tara and @John, I am really sorry that you feel the advice is not what you expected. I am learning as I go and have never claimed to be a financial savant. What I am hoping to do is to share tips that I learn along the way that work for me, hoping that they may work for somebody else facing similar financial challenges. I strongly believe that leveraging your company plans is smart option for your average person who is not a savvy investor. Saving something is a lot better than saving nothing.

  • I wish my company offered a plan to insure appliances.  We built our house and everything is dying at the same time.  Wish I had some coverage.  13 a month is not going to replace my 1,000 washer and 800 fridge both out of warrenty after 1 year so that "gasp" left me the last 7 years having to pay for repairs on these high end machines.  In one year I will have spent around 150.  Even after 4 years that is 600.  How will that replace my washer and dryer, fridge, microwave, and dishwasher. I would have to look if to see how inclusive the policy is though.  The idea sounds great.

  • Not many companies can say that their customers were so passionate about being customers that they would take two days out of their lives, vacation time from work, and time away from their families to speak to what they believe has been their financial

  • My credit score went from 640 to 740 after paying off a few of my creditors.  This process does work if you stick with it.  I am planning on buying a car next year with my new and improved credit score.  Thank you Care One Debt Relief!

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