You know you need to reach for the mop if:
- You don't pay off your credit card balance every month.
- Your credit card balance exceeds your monthly paycheck.
- You pay your bills late, incurring costly fees.
- You spend $10 a day on coffee, snacks, and cabs, yet you don't invest in a retirement fund.
- You eat at expensive restaurants that are so out of your price range that you lose your appetite.
- You have clothes that have never been worn and still have their tags.
- Your closets are jammed with impulse purchases—grills, dehumidifiers, toys for the kids—that have never been used.
- You buy things you can't afford.
Make bill paying a monthly ritual—with your partner, if you live with someone. Put on some good music; open a bottle of wine. Do whatever it takes to commit to this.
- Always pay your bills on time and never go over your credit limit, which can save you $25 a month or more. By paying on time and paying in full, you'll save yourself a lot of money and stress.
- Find an extra $50 or $100 a month so you can pay more than the monthly minimum on your credit card balance. Come on, give up one trip to the movies and one dinner out a month and you'll save about $50. Do you realize how much more money you'll have if you stop paying the credit card company 18 percent interest?
- Once your balance is paid off, keep making those extra payments—to yourself. That's your retirement fund, the money to pay off your student loan, or the down payment on your first home.
- Clear your closets of every unused and unwanted item, and donate it all to charity. The tax deduction is a great financial move.
- If you haven't been balancing your checkbook, it's time to start over. Open a new checking account. Pay off your outstanding bills from your old account and close it. From now on, do all your banking from this new account. Balance it every month and track those ATM transactions. By closely following your spending, you will never live beyond your means.