Four Times You Should Pause the Debt Snowball

I wanna keep rollin’ on the river like Proud Mary, but I might have to let the debt snowball chill a little. And that’s perfectly fine. Really, it is.

We can get tunnel vision when focusing on a goal, but life happens and we must reconsider where we put our energy and our money. Sometimes it’s better to save it than pay off more debt.

Here are four times it’s OK to pause your debt snowball.

1. You dipped into your savings.

This is probably the most obvious reason, right? You get a flat tire (or two) and use your baby savings to cover it. To replenish the coffers, press “Pause” and put any extra money back into the fund for the next snafu. Because we know it’s not a matter of ‘if’ one will arise. It’s ‘when.’

2. You have a major life event on the horizon.

Surgeries, moves and births cost a whole lotta money. To avoid huge charges on a credit card, press pause on the debt snowball to shore up some cash. You’ll feel much better saving to spend than becoming further indebted.

Times You Should Pause Your Debt Snowball

3. You’re not sure of your next move.

Maybe just pause for one month to try to figure out the next step. You’ll want cash on hand if you have to move or pay for a certification for a better job. If you give all of your money to your Visa, guess where you’ll go when you have no savings and you need money again. That’s right! Visa. If you feel more stable after a month or two, then throw that extra savings back into the debt to start the snowball again.

4. You want to eliminate debt with the highest interest instead of the lowest balance.

Your debt snowball is supposed to roll from the smallest balance into the next. Well, what if two balances are nearly the same, but have different interest rates. That $623 student loan incurs only 1.9% interest each month. But that Chase Card’s gotchu for 24.24% interest each month. That balance is $825. The student loans accruing about $0.40 of interest each month. Chase’s accruing nearly $20, and you’re only making $30 minimum payments. That hustling backwards.

This was my predicament on May 1. I wanted to get rid of that credit card for the emotional win and peace of mind. And guess what! I paid it off on May 31—in just one month! Switching from the debt snowball to the debt avalanche paid off big time! Now, that student loan is in the crosshairs.

Have you ever paused your debt snowball? Why and how’d you decide to do it? Please leave your thoughts below.

Non-Monetary Benefits of No-Spend Challenges

Often, people go into no-spend challenges, spending freezes or financial fasts just thinking about the money they’ll save. That’s definitely a huge component, but I’ve grown to love hitting the reset button on spending every so often because of these perks that don’t directly deal with money.

  1. Spending “shopping time” on other things—more important things. Money and time seem to multiply when you don’t shop.
  2. Greater appreciation of the little things. Free candy from a coworker or spending more time with family instead of at sales could make you ridiculously grateful when your wallet’s closed.
  3. Better differentiation between needs and wants. This is key for slaying debt. You gotta spend on things you truly need and value.
  4. Looser jeans. Eating home-cooked meals and rationing out meals to last a whole week (or however long you choose) can reduce your waistline.
  5. More self-control. That discipline muscle will get a workout. You’ll get better at telling yourself “No” and maybe get more strict with portion sizes to stretch meals.
  6. Cleaner pantry. It’s wise to use up what’s in your fridge and cabinets instead of wasting food, buying more groceries or eating out.
  7. More creativity. When you clear out your pantry, you end up mixing odd ingredients in stir fries or eating breakfast for dinner to use up your pancake mix.
  8. Less clutter. You have less stuff when you buy less stuff. Easier said than done sometimes, right?

Am I missing anything? What perks have you gotten from completing a no-spend challenge? Leave your comment below.

How to Use Brag Binders for Job Interviews and Salary Negotiations

*This post contains affiliate links. That means I receive a small commission that could help me on my debt-free journey —at no extra cost to you—if you make a purchase using the links.

The term “brag binder” seems self-explanatory, right? Put all the good stuff in one place so you can easily show it to your boss or potential client. It’s no different than photographers having an online portfolio of their best shots. Would you hire a wedding photographer without seeing their work? Exactly!

But I didn’t have a brag binder at my last job. I didn’t really tout my accomplishments on LinkedIn—the digital brag binder—either. And guess who never got a big raise. Me. Guess who never got a substantial promotion. Me, again. Maybe adding this one tool to my arsenal could have helped me earn more to slash debt.

In her book, Real Money Answers for Every Woman: How to Win the Money Game With or Without a Man, Patrice C. Washington gives excellent tips on how to get over yourself to earn more money. When explaining how to negotiate a higher salary, Patrice suggested showing your value with a “brag folder.” So what do you put in it?

  • positive reviews
  • notes of appreciation
  • thank you cards
  • awards
  • certificates

I re-read the book over the winter and immediately started keeping my 

accomplishments and praise in a folder.

“Your goal is to become crystal clear about what qualities you bring to the table, so you can learn to articulate them effectively,” Patrice writes. “You don’t want to appear bratty or cocky, but you do want to make sure that you’re not ashamed to toot your own horn when and where it’s appropriate.”

She says the brag binder does two things:

  1. It boosts your self-esteem and helps you be confident walking into an interview or salary negotiation.
  2. It makes sure you’re armed with the facts, so the meeting isn’t an emotional conversation. (“I deserve a raise. I just do. I’ve been here 30 years.”)

Screen Shot 2017-05-18 at 1.25.41 PM

I recently interviewed for an internal promotion with a nice raise. I went a step further with my brag binder by taking into account the interview rubric. The man with the power to promote me wanted examples for each of the eight criteria:

  1. building relations
  2. entrepreneurial spirit (doing what needs to be done before being asked)
  3. customer orientation (satisfying customers)
  4. functional/industry knowledge (continuous learning and applying that knowledge to get good results)
  5. results orientation (setting goals and actively working toward achieving them)
  6. fostering teamwork
  7. developing others
  8. managing resources (being efficient with human resources, time, money and other materials like paper and ink)

Every hiring manager in the world is probably using the same barometer for measuring a candidate’s potential. Consider examining yourself to see what grade you’d get in each category. But I digress.

I pulled out my brag book to play Show and Tell with him. When he asked, “How have you fostered teamwork?”, I showed emails, texts and meeting agendas I created.

“Have you mentored other teachers?” I showed detailed notes and suggestions I wrote from observations.

“What projects have you lead at school?” I showed him the whole process of an iPad story writing competition—from training other teachers to emceeing the awards ceremony—and presented some of the students’ work.

The interviewer let out a few “Ohs” and “Ahs” while flipping through the pages. I think my interview ran longer than the others. Good sign, right?

I hadn’t done a physical portfolio in so long. I’m glad I took Patrice’s advice. When I left, I saw a coworker stand up with nothing in tow. These physical examples might give me a leg up in the hiring process. I’m hopeful.

Screen Shot 2017-05-18 at 1.13.30 PM

Did I use a special binder?


Not really. I useda 30-pocket display book that’s ubiquitous in China. My school had already given it to me, so I didn’t buy anything.

What did I include in it?

  • 
resume
  • cover letter
  • blog posts I’d written to help other teachers (shows expertise in your industry)
  • emails from higher-ups congratulating me on a job well done
  • emails and text messages (print-outs of screenshots) showing collaboration with coworkers
  • posters I designed to promote sign-ups for extracurricular events
  • PowerPoint presentations I create for the iPad competition training and the awards ceremony
  • examples of my students’ work
- agendas for meetings I lead (shows organizational and leadership skills)

How did I organize it? 


I put my resume and cover letter in the front. I tried to place examples in the order of the rubric. And I also put like things together, so the whole process for the iPad story writing competition was in one section.

How could I improve the brag binder?


Quantify. Quantify. Quantify. I could have dug deeper to find an instance where I saved money or increased profits with my ideas and execution.

How could you use the brag binder?


Show case studies. Everyone loves to see before-and-after, rags-to-riches or ugly-duckling-to-swan stories. That’s why we binge-watch home makeover shows and go gaga over #TransformationTuesdays posts about weight loss.

So tell a story about how you improved some aspect of your business. The case study should clearly state (1) the initial problem, (2) list the solutions you thought of and the reasoning behind it, (3)  how you implemented those solutions and (4) the results. Did you make communication more effective? Did you reduce costs? Did you eliminate redundancies? Did you increase profits? By how much?

Web designers could show how they turned a crappy website into a masterpiece, bringing in 200% more lead generations for that company.

Teachers could show old test results, methods they used to improve the students’ grades and understanding, and new test results.

Financial coaches could show their client’s busted budget and the budget they helped them create. They could say “On average, I help my clients save $500 a month after budget consultations.” Now, that’s something!

Don’t be afraid to show a company or employer what you’re made of. They want to see results. A brag binder is one way to do that.

Here are links to more explanations of brag binders:

Have you used a brag binder or portfolio to get a salary or a new job? How did it go? Please share your tips below.

12 Tips for Staying in the Debt-Busting Mindset

*This post contains affiliate links. That means I receive a small commission that could help me on my debt-free journey —at no extra cost to you—if you make a purchase using the links.

Debt-fatigue is real! Paying off debt month after month gets old, but it’s necessary to attain financial freedom. Ain’t nothing wrong with reciting affirmations (I love it) and reading books (I almost love this more than chocolate). But we already know how awesome those practices are for believing in and educating ourselves. Here are 12 other tips for staying motivated along the debt-free journey.

1. Imagine your life with no debt and huge savings.

Really. Just imagine that. Think about what your life would be like without sending $400 to your alma mater each month for that 10-year-old degree. Think about the vacations you’ll take with your family and the memories you’ll make. Think about the smile on your kid’s face when you watch her soccer game instead of moonlighting at the coffee shop. Think of putting all of that credit card interest in your Roth IRA. Better yet, go to a retirement calculator and type in what you pay in interest every month as the monthly contribution to see the what your money could be doing. If none of these scenarios motivate you, then I don’t know what will. Always remember why you’re paying off debt in the first place to stay focused.

2. Repeat: “Budgets are my friend. Budgets are my friend.”

Is that an affirmation?! Ha ha! Anyhoo, some of us think budgets suck. But nah! They don’t deprive you of anything. Think more positively. Budgets (a.k.a. spending plans or financial freedom maps) help you achieve your goals quicker and easier. When you direct where your money goes, you don’t wonder where it went at the end of the month or whether you’ll reach your credit card payoff goal. You’ll know that you’ll achieve your goal in three months by paying $200 each month. You become the boss of your money.

3. Nickname accounts according to your goals.

“Savings x5678” doesn’t provide much motivation or clarity as to why you’re saving in that account. Put some respeck on that name! Change it to “Summer Disney Trip” or “Dream Home Down Payment” to keep your goals top of mind. When you remember why you’re saving, you’ll be less likely to dip into that account for jeans. Got a credit card balance you want to crush? Go to your online dashboard and change the name from “Visa x1234” to “Pay off by July.” Feel free to change your passwords to reflect your goals, too. How about $lashD3btby2020?

TIP: If you use the Bank of America app, follow these instructions. Sign in > Click on the name of the account (i.e. Bank of America Gold Visa x1234) > Click “Edit” next to the account name > Type in your awesome, new, goal-oriented nickname. > Press “Done.”

12 Tips for Staying in the Debt-Busting Mindset

Click here to get more tips.

Save or Pay Off Debt? Or Both?! Use This Decision Map for Guidance

Dozens of best-sellers, financial gurus and conventional wisdom will tell you to save for retirement no matter what part of the financial journey you’re on. “Save yesterday!” they shout. The one person who goes against the grain is Dave Ramsey. The man even tells people to stop getting their 401(k) employee match to put every red cent into paying off debt. Extreme much?

Here’s why? The power of focus. Dave says when people get “gazelle intense” about slashing debt in Baby Step 2, they do it in 18-24 months on average. They stop 401(k) contributions, sell everything but the kids and create extra income streams during this intense season. These folks are determined to pay off lenders quickly so they can start paying themselves.

But not everybody’s drinking the Kool-Aid. They understand the power of compound interest over time. Many folks in the debt-free community are savings for retirement and eliminating debt, forgoing Dave’s advice. I’ve been tempted to follow suit.

Are you on the fence, too? Ask yourself these questions to determine whether to save, slash debt or save and slash at the same time. See what I decided at the end of this post.

Do you have at least $1,000 in savings?

Yes? Awesome! You can start aggressively paying off debt. Having $1,000 or one month’s income saved means you can put out fires like paying off an unexpected dental bill or replacing tires without getting into more debt. That’s key!

If ‘no,’ chill out on aggressive debt payments. Pay the minimum until you save up $1,000 in an account you can easily access when emergency situations arise. An interest-yielding account at a credit union or online bank that’s separate from your main checking account and debit card will come in handy for this. If you feel more comfortable putting away $2,000 or a full month’s income, then go with that. Personal finance is personal. These questions and tips are guidelines.

Save or Pay Off Debt Decision Tree

Click here to read more and find out what I decided.

The Cash Envelope System and How It Saves Your Budget

I finally broke down and starting using the cash envelope system on April Fool’s Day. And guess what. The system works! It turns out I’ve been a fool for not using it sooner.

I’m starting to think no budget is complete without cash envelopes. Here’s the gist: You put a fixed amount of money in envelopes at the beginning of the month, the beginning of the week or per paycheck. Your preference. When the money’s gone, IT’S GONE. This helps you build self-discipline, stick to a budget and accomplish all of your debt-slaying, wealth-building goals.

After making a budget, I stuffed two envelopes with a combined 2,203¥ (Chinese yuan). Then I worked overtime and earned 360¥ in cash and added that to the mix. For the month, I had a total of 2,563¥, roughly $371 (USD). The envelopes were for fun and incidentals money, and food money (groceries and eating out).

There are tons of free printables online. I got mine here. If you want some affordable envelopes with cool designs, then visit Broke on Purpose.

What might happen while using the cash envelope system:

  1. You better appreciate money. Studies show you spend more when you use a card than you do with cash. When you have cash, you think long and hard about letting those dollar bills go. It’s true! When your envelopes start getting thin, you’ll find ways to do stuff for free or just go without. Even if you know you have money in the bank, it’s out of sight. Your focus is on the cash and how you can keep as much of it as possible.
  2. You practice delayed gratification. At the beginning of the month, I didn’t want to blow all of my money. So I’ve learned to wait for stuff. I’ve been coveting a bookshelf at IKEA all month. Every time I think about it, I force myself to wait until the end of the month to make sure necessities are taking care of.
  3. You feel bad about spending on silly stuff. Candy? Nah. You need to buy spinach next week. You actually spend on things you value.
  4. You stop checking your checking account and use your budget to OK spending. How many of us have a habit of looking at our bank accounts to see if we can afford something? I know I do. But there was no need to check it. The envelopes told me what I could afford. Of course, I checked my balances after I paid rent and energy bill online, but there was no more justifying expenses just because I had money in the bank. I actually didn’t check my account for weeks. I visited the ATM on April 10. I went back on April 21. When I reached in my wallet, I couldn’t find my debit card. I left it in the ATM nearly two weeks ago and HAD NO IDEA because I’d been using cash. That blew my mind! Thank heavens the bank stored away my card when I picked it up on April 24. Crisis: averted.
  5. You stick to a meal plan and/or clear your pantry. Well, if you have a meal plan, you’ll be more likely to stick to it. You’ll think, “I spent $50 on groceries. I’ll use them up before I eat out or buy something else.”
  6. You tell your friends “No.”— a lot. At least, in the beginning, you’ll turn down invites because you’ll want to save money for later.
  7. Your friends, coworkers or relatives might mock you. Don’t worry. They may not understand you at first, but most will get over it and support you. If they don’t, then they’ll get the point when you’ve climbed out of debt or invested tons of money in your IRA.
  8. You feel guilty for even thinking about using a card or online payment services. In China, everyone uses the Holy Grail of messaging apps called WeChat. The Wallet feature lets you transfer money to friends, pay restaurant and taxi bills, top up your phone data, pay for movie tickets and more. You don’t need cash if you have WeChat. I was in a crappy mood one day and wanted a chocolate muffin from Costa. I reached for my phone to use WeChat Wallet, but my arm started to hurt and my brain said, “NOOOO! USE YOUR CASH ENVELOPE!” A force-field surrounded me! I listened to my body and got 15¥ out of my blue, food envelope. That’s when I knew using the cash envelope system had turned into a habit.
  9. You cause others to wait in line behind you. Yeah, it happens. A few seconds won’t hurt anybody.
  10. You are able to help someone when they ask “Hey, do you have change for a fifty?” It’s a great feeling when you can say “Yes, I do!”
  11. You stick to your budget and have money in the bank at the end of the month. I know you like that, right?! That means you can put more money toward a debt or savings account. If that doesn’t make you want to cash in on this system, I don’t know what will! (Pun intended.)

Cash Envelope System Saves Budgets
Want to try it? Learn how to get started.

8 Things to Consider about Balance Transfer Cards (Freebie Included!)

Balance transfers are fantastic—IF you use them correctly. That’s a big ‘IF.’ These transfers move a balance from an interest-yielding card to a new card that offers an introductory interest rate as low as 0 percent for a certain time period. 

That means you’re putting money toward your balance—not the pesky interest—over that period, for example, 6 or 12 months. You can even put more than one balance on a new card. This tactic can help you get out of debt quicker and save hundreds of dollars overall.

You MUST make up your mind to kill this debt before the carriage turns into a pumpkin or you’ll be S.O.L. and stuck with paying interest again. Download your free worksheet here to get started.

The Tale of Two Cards

In early 2015, I got my first balance transfer card, the Chase Slate. Chase paid Old Navy, making it seem as if I paid the card in full. Then I started paying Chase without worrying about interest. I killed that debt well before the April 2016 deadline with a huge medical bill reimbursement.

Transferring your balance won’t do you any good if you don’t pay it back in time.

I got a little happy and took advantage of another transfer offer in 2015. Well, it took advantage of me. Ha ha! Life happened. My paid-for, 2001 Mazda croaked the day before Thanksgiving that year. I got a new car—and the $250 monthly payments to go with it. That meant my huge payments to the balance transfer card stopped cold turkey (Pun unintended). Then, I started spending money to prepare for China. 

I couldn’t pay the card off by November 2016 and have been getting hit with about $40 in interest each month ever since in addition to the $2,000-plus balance. IT SUCKS!

I’m unsure if I’ll ever get another transfer again, but if I do, I’ll heed these tips, make a concrete payback plan and stick to it come hell or high water.

What To Consider When Selecting A Balance Transfer Card

Bankrate.com is a great place to start comparing balance transfer cards. When you look around, check out these details:

Read more and get your free worksheet.

7 Things to Do Before a No-Spend Challenge

Let’s celebrate! I actually completed a no-spend week without major fails. Yayyyyy!!!

If you’re unfamiliar with no-spend challenges, here’s the gist: Don’t spend any money on things other than necessities, such as bills, groceries and gas. Chips from the vending machine and brunches with the girls don’t count. You can do it for a week, 3 weeks, a month or even a year. And there are tons of benefits to doing a no-spend challenge besides saving money like losing weight and having time for things besides shopping.

About three years ago, I completed the 21-Day Financial Fast under syndicated columnist’s Michelle Singletary’s tutelage. It was life-changing. But I hadn’t done another no-spend challenge until this year under Bola Onada Sokunbi‘s guidance.

In her accountability program, members complete a no-spend week every four weeks. It’s a monthly reset. I failed the first three challenges because I didn’t prepare at all. I just winged it. But I think I’ve unlocked the keys to starting a no-spend challenge on a high note and sustaining that momentum.

1. KNOW AND WRITE DOWN YOUR GOAL(S).

You will hit a wall during the no-spend challenge. You will. You will get stressed at work or school and want to indulge in retail therapy. It helps to know why you’re doing the challenge in the first place. Write it down and go back to that note when you’re feeling down.

Perhaps you want to save an extra $100 or simply stop running to Target every other day (We’ve all been there). Keep a post-it note in your wallet, make a screensaver on your phone or create a daily alert on your phone so you see your goal first thing in the morning.

No-Spend Challenge Preparation Tips

Go ahead! Read some more.

First Quarter 2017 Reflections

*This post contains affiliate links. That means I receive a small commission that could help me on my debt-free journey —at no extra cost to you—if you make a purchase using the links.

The older I get, the more I understand how important it is to reflect. To think about what went wrong and, most importantly, what went right. Reflection helps you know what habits to keep and kick to the curb. So here I am, reflecting on my first-quarter goals. Here they were:

  1. Save $500 (3500¥).
  2. Cut recurring bank fees.
  3. Earn a raise and promotion.
  4. Cashflow birthday turn-up.
  5. Read 3 books.

How did I do? I checked off every goal. Yayyyyy!

1. Save $500 (3500¥). I ended up socking away $1,000 by saving my entire federal tax refund and putting a little away from my March paycheck. To complete CFG’s 26-week savings challenge, I’ll save $378 more by the end of June.

Reasons To Become Debt-Free(2)

Keep on reading!

5 Big Money Mistakes I Made in March + How to Avoid Them

March started out with good intentions. So you know what my next sentence is gonna be, right? My execution was terrible. I lost focus pretty quickly. Here are the biggest money mistakes I made last month—and how I plan to avoid them from here on out.

1. I didn’t track my spending.

I had a budget on EveryDollar and everything. But the app won’t work unless you open it. For the first time in seven months, I don’t know what I spent my money on and didn’t save a dime. It’s an empty feeling to have an empty checking account, a paltry savings account and no idea why.

How to avoid this mistake: Create habits or alerts that force you to track spending every day in your budget. I will get back into the habit of recording every purchase at the time of the purchase in my phone. I’ve also set a reminder on EveryDollar so I’ll get that “It’s time to track your purchases” alert every night just in case Plan A fails.

Click to read more.