Steve and Katrina Marks of Mishawaka remember a time when they had over a dozen credit cards.
“We did have quite a few. You name it we had it, every store, we had a Visa, MasterCard, a Discover, Best Buy, Penney’s and Sears.
Why so many? They admit that they were attracted to the so-called special offers.
“The 90 days same as cash. It took a while for us to realize that's not really a sale,” say the Marks’.
What is really happening is record amounts of debt since the average American is $12,146 in debt.
Indiana ranks 35th in the nation with average debt totals of $10,867.
Michigan ranks 30th in the nation with $11,856 in average debt and these numbers do not include mortgages.
Amanda Wellington of Greenpath Debt Solutions tells her clients the first thing they need is a budget.
“We council a lot of people who are actually upside down every month. Sitting down, adding up the monthly income for that household and then looking at the expenditures, the expenses month to month, it is a very important first step. Because without that you don't know how to prioritize you don't know if there is any money left over,” says Wellington.
Don’t think there's room to budge? Wellington says look again.
“I talk to a lot of people who have huge cable bills, huge cell phone bills, along with landline's and long distance and ya know everything on the internet package. Those are easy areas if money is not there, that if the budget is really upside down every month, if there is really more going out than coming in, use the cell phone only, or turn off the cell phone for a while and use the home phone only. It is a little more inconvenient but there is money to be saved there,” says Wellington.
The Marks started sticking to a budget and then signed up for the popular Dave Ramsey Financial Peace University.
Several area churches offer seminars teaching Dave Ramsey’s methods, including harvest community in Mishawaka where Steve is a pastor.
Among the Dave Ramsey tips, he suggests that you use cash instead of credit.
The Marks’ say, “He uses an envelope system. He says take your check and cash it. Put so much away for groceries and so much away for going out to eat.”
It has changed their way of thinking and spending now that they have they trimmed most of their debt when they cut out their credit cards.
“We do have one that we keep for emergencies, but we do not carry a balance on it. We have a debit card and other than that we pay cash and write checks. We aren't in debt other than our mortgage payment,” says Steve.
That is a better feeling that even money can't buy.
Car loans are another area where most consumers can save and Wellington says do your best to get rid of those payments.
Try to save on driving expenses and you should cut down on needless trips for extra errands and look into car-pooling to save on gas because every penny counts.