Subscriber Swap Saturday: Interview with No Debt Plan

No Debt Plan is about getting and staying out of debt with a plan. Kevin, the author, is passionate about budgeting, saving for the future, and using goals to reach financial freedom. You can subscribe to his blog by RSS or email.

This interview is part of a new feature he’s developed called Subscriber Swap Saturday. The basic idea is to get the subscribers of one blog to subscribe to the other blog for at least a week, just to try it out. After a week if you don’t find that blogger’s content enticing, drop it. The hope is that over time you will find several writers that you weren’t familiar with who provide meaningful content to you. You can read more about Subscriber Swap Saturday at his get out of debt blog, and you can read his interview with me here.

Briana: How did you get started with your blog?

Kevin: I had tried blogging before on my personal blog, but I wasn’t consistent and eventually gave up. Mix that with the fact that I found myself offering a lot of budget advice and it seemed natural to start up a blog. I had been reading a lot of other personal finance blogs and noticed a few people were making quite a bit of money blogging. My aim was to provide meaningful advice while getting a cut of that income pie.

Kevin: Grammar? I try to write well, but I’m not trained — I wasn’t a journalism or communications major. I’m just an average guy writing. Sometimes coming up with new topics that I think will be interesting to readers can be difficult. It’s an interesting challenge, and I’m learning more every day.

Kevin: To take a deep breath. A lot of people hear the word budget and just freak out. To those people I say chill out. If you prefer to call it “telling your money where to go” that’s fine. Whatever works for you.

Once you get past that mental block understand that your budget doesn’t have to be that fancy. Our budget is quite complex — multiple spending and saving categories. That works for us. If you broke your budget down into four categories only that is still a positive step forward. Estimating what your costs are for each month is a critical first step.

Kevin: I always recommend a custom setup in a spreadsheet like Microsoft Excel. This can be overwhelming for some folks, but I really think it is the best. Other than that you might consider one of the online tools like Wesabe, Mint, Yodlee Money Center, or Budget Tracker. My only concern with the online platforms is many of them require you to submit your username and password to all of your financial institutions. Giving up that information is a great privacy and security concern for me personally. (Not that those websites don’t handle your information well, but my thought is the more people that know the info the worse off the security situation is.)

Briana: One of the coupon myths is that only people with less money use coupons. How can people who don’t necessarily “need” to use coupons use their grocery savings to maximize their total budgets?

Kevin: Here’s how I see it. If I can spend $2 on a Sunday paper and get at least $4 in coupon value, I’ve doubled my money. Every dollar that you save by using coupons should drop to the bottom of your budget and increase your free cash flow. Even if you just use coupons on items that you would regularly buy you should be able to get value out of every paper.

It can take time though which is where you have to be careful. If you’re only getting $2 of value from every paper (and thus only making your money back) then you are wasting your time. We have found that you can really start to chalk up some savings with coupons although it does take a couple of weeks for the savings to really kick in if you are trying to line up the coupons with the in-store deals.

Briana: For a personal finance blog, you say credit cards are not the enemy. Please explain.

Kevin: How about an example? Let’s say I live in the woods. I have myself a nice little cabin. It’s quiet and I sleep well. Next to my bedroom door I keep an axe. I use that axe to cut down trees around my cabin — to build a fence, to open up ground so I can plant a garden, to have wood to burn in my fireplace. The axe is my trusty tool, absolutely vital to my survival out in the wilderness.

But, the axe can be used for murder just as easily. This tool suddenly looks dangerous. I should tell everyone I know not to have an axe because of the danger of murder.

To me that sounds a bit silly, no? I see credit cards the same way. The credit card is a tool. A credit card is just a piece of plastic with little metallic numbers afixed to it. It is nothing special. In fact if you compare your debit card with your credit card you will find them to be eerily similar.

How you use the tool makes all the difference in the world. Yes, credit cards charge interest and many people get sucked into this. I feel this comes from a lack of self-control in spending. The credit card didn’t hop out of your wallet and put a gun to your head and say “Buy more stuff or else!”

A lot of people disagree with me and that’s fine. Disagreeing is fine — ignorance is not. I’ve heard everything from credit cards are evil to if we didn’t have credit cards the cost of items would be cheaper everywhere. I’ve talked with business owners and discovered this is entirely untrue — many businesses prefer credit cards because they get payment instantly. With checks you are at risk of the check bouncing and with cash there is a risk of it being stolen.

Okay, I’ll get off my soapbox. :)

Kevin: I’d love to say we are absolutely perfect and never find ourselves in this situation, but that’d be a flat out lie. Of course we go over-budget. (Gasp!)

We don’t live paycheck-to-paycheck. In fact, we live in this month off of last month’s income. So right now February is paying for March. This is extremely important because we are still earning income in March which simply adds to our safety net. We reset the budget at the end of every month, so if we go over we are really just dipping into the next month. We can then adjust the next month’s budget to compensate for going over-budget.

Kevin: Chuck on NBC! I can’t seem to find anyone else that likes it, but it’s funny, has a romance story, and is full of action.

Briana: Chuck is one of my top shows too! :) Thanks for asking me to do Subscriber Swap Saturday. It has been a blast to learn more about you and what the No Debt Plan blog is about!

If you enjoyed this swap as much as I did, be sure to stop by No Debt Plan and read more great posts on living a debt-free life.  And don’t forget to subscribe to his blog.