whatgoes_budget_filter21.gifA young couple came to me several years ago. At the time, they had a good combined annual income of over $100,000 yet owed $20,000 to credit cards, and they were adding debt at the rate of almost $2,000 per month. Despite their high income, they were spending considerably more than they were earning.

When we reviewed their situation, I discovered that a lawn service visited their home four times a month, at $85 per visit. I told them to cancel the service, and he replied, “But our lawn will look terrible if we do that! We must keep this expense.”

I also noticed that they subscribed to cable TV, including every premium channel — a monthly cost of $97! I told them to cancel cable. Monica gasped. “There will be nothing for us to watch! We can’t cancel cable!”

I’m sure you’ll agree with me that a lawn service and cable TV are optional, yet neither understood this. Both these expenses are optional, just as — pardon me for shocking you — almost your expenses are optional.

Health club membership? Optional. Entertainment? Optional. Telephone? Optional. Clothes? Most of it — or more accurately, the total money you spend on it — is optional.

Are you getting my point? Almost everything you spend on is optional. So don’t tell me, “I got to do this, I got to do that.” Sometimes, though, you’ll find that you’ve been spending money on a certain item or in a certain way for so long that by now, not only can’t you remember when you didn’t spend money like that. Again, let me repeat: Almost everything you spend money on is optional!Cable TV is optional. Hard to believe, but true.

You stop spending your money on things that in the bigger picture really don’t matter. You change it. You fix it. You can stop it.

Don’t feel locked in or trapped, because you are not. True, there are some expenses that you cannot change easily or quickly. Once you buy a car, you’re stuck with the payments. But most of your spending is much more flexible than you might think at first. You are in more control of what’s happening around you than you realize. But you’ve been doing it for so long for so long that you’ve forgotten that you do have a choice about how you spend your money.

The bottom line is that you got into debt because of your attitude, not your income. And it is your attitude about money that must change first, or changes in income won’t matter.

By refusing to change how they spent money, they sought other solutions for their debt. And they found one: the equity in their home. They owed $150,000 on their $200,000 home, so from the $50,000 in equity, they borrowed $25,000 and used that money to pay off their credit cards. Problem solved, right?

Wrong: Within a year, their credit card balances were back up to $24,000, only this time they no longer had $50,000 in home equity to rely on. Within two more years, unable to keep up with the payments on their house, they sold it and rented an apartment (at least that ended the lawn service). Still, it wasn’t enough, and they later filed for bankruptcy. It will be 10 years before they are able to buy another house — if ever.