What to do with Money When You’re Just Starting Over – Tips for Survivors

This week we’re wrapping up our conversation about money. I thought it would be a good time to talk about the things I’ve learned about handling my money since I left my abuser. The fact is, that we discuss domestic violence openly and without shame. I thought any discussion about money should involve what I have learned since I’ve left my abuser. This post is pretty long – it may only take about 10 minutes to read. 

About 15 years ago, I left my abuser. I was in my early 20’s, I had a young child, and a cat when I left. I had very little money and I was unemployed. I didn’t have a savings account because any money I obtained went to pay our “joint expenses.” I couldn’t keep a job because I let him bully me into staying on the phone with him almost constantly so I got fired.

This situation is similar to most victims. Victims often leave with nothing but a few clothes or a bag of belongings. They may never be able to get their things and have to start over from nothing.

A very quick outline of my experience.

When I left, my friend let me stay with her, and after a little effort and driving around I got a job waiting tables. I barely made minimum wage. I slept on a mattress on the floor of her attic and my son slept in his portable crib next to me. 

When I finally got my subsidized apartment, I took it without even seeing it. When I viewed the apartment, I breathed a sigh of relief. Utilities were included and I could afford the rent because it was based on my income. Plus, the little money I had could get me what I needed to furnish the place and buy our food. 

Ten years after I took that apartment, I had finished school, I owned my own business, I bought my own house that I fixed it up, and lived on my own income. During that ten years, and since then, I have learned and implemented several ways of paying off debt, staying out of debt, and living frugally. 

1.

Make a budget. I learned this from Dave Ramsey’s Financial Peace University. I’ve also read it in almost every financial blog, article, and book on how to manage money. For most of us, budget is a dirty word. We’re wrong and it’s not – budgeting is a method of controlling your money so the creditors don’t control you. It also prevents that looking back, wondering where it all went situation. 

For my first budget, I looked at my prior months’ expenses and listed everything I paid for on paper. Then I looked at my prior month’s income. I added up both, subtracted expenses from income, and then came up short at the bottom. I adjusted every category so that I didn’t overspend and that was my budget. I had to adjust during the month after that because I’d forget something or an underestimated category. 

Now I use everydollar.com. It’s budgeting software that makes budgeting easier and does the math for you. First, it’s free if you don’t automate it from your bank. Then, after your first month, it will copy your prior month’s budget for you to make it easier. There’s an app too – so you can put your budget on your mobile and track your spending in real-time.  

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2.

Tithe, Save, Spend. We operate on a 10-10-80 budget. The proportions are your decision – I’ve seen 70/30, 80/20, and so on. If you’re Christian, God tells us to give the first and best from our income. That’s usually 10%. Each time a paycheck comes in I write a check for 10% of it. Next, I’ve recently learned to save 10% before expenses. This helps to build the emergency fund quicker. I used to do this 10% after I paid bills and often I didn’t transfer it to my savings because something would come up or I’d go over budget. Saving first helps build the savings faster. 

3.

Divide expenses by paychecks and adjust due dates where possible. This is a little trickier. At the beginning of the month review your expenses and create your budget. Then identify your pay periods and pay dates. Next, identify the due date to every expense on your budget. Finally, place each expense in a pay period. Don’t forget to include groceries and household items in these lists. Once that’s done add them up. 

Some weeks you will have extra and some weeks you will be short. This means you’ll have to move the expenses to earlier pay periods or move the due dates. For short weeks, pay something early – do not pay it late. Late fees are tiny expenses that add up to big dollars. Do not overdraft your account, that’s more fees that you can’t afford – in some states, this can result in criminal charges for passing bad checks or fraud. Swallow your pride, call the company, and make a payment arrangement or try to adjust the due date. 

For example, I pay my mortgage with the last paycheck of the month and it is always early. The first paycheck has almost all the utilities and insurance expenses in it so if I paid the mortgage on this check there wouldn’t be enough. Instead of paying something late, I pay the mortgage early. You are spreading the bills among the checks to prevent late fees, overdraft fees, and creditor calls. 

If you’re short for the month there’s not much that can be done about this. First, pay for the basic needs – house, food, utilities. Then add in-vehicle, insurance, and auto expenses like gas and oil changes. After that add in necessary expenses that are unique to you and your family like clothes that need to be replaced or baby needs. Finally, last pay your credit card or unsecured credit bills. If you don’t have money to pay the credit card companies call them and tell them. If it’s temporary then make arrangements. If the situation is ongoing tell them and see if you have options. 

If you don’t have enough for the first category of necessary expenses, contact your local county health and family services for financial assistance with insurance, food benefits, and possibly unemployment benefits. You may also identify a food bank, utility assistance service, or some other local charitable organization that will help you with expenses that you may have. If you need help identifying a food bank either an internet search or contact a local church will point you in the right direction. 

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4.

Monitor the grocery bill and don’t buy what you don’t need. Groceries are often one of the largest expenses for most of us. It’s also the hardest to minimize and can get out of control easily. When I first was starting out I didn’t buy anything that wasn’t necessary. These are things like soda, potato chips, desserts, snacks, or prepared meals. These items quickly add to your bottom line. Also, I ate a lot of fresh or frozen vegetables, meat from the case (not the freezer section), and I bought in large or discounted packages. We always ate leftovers often to prevent waste. These are methods of managing money that I still use today. 

I don’t buy coffee out unless I’m getting together with a person or treating myself. I can buy a bag of coffee for the cost of one or two take-out coffee drinks. I also don’t buy soda and water from a vending machine or cooler case if I can help it. I can buy larger packs at the grocery for a fraction of the price. If you don’t add these to your order, then purchase them one at a time, you’re robbing from yourself. 

5.

Make a dinner menu then buy the items to make that food. I have a list of food that I know how to make, that I like to eat, and that is easy to make. I used to have a list of food my son would eat as well. From that list, I decide what sounds good for the week. I also add in the things that we use regularly to the grocery order as well. 

I often will rearrange the menu during the week. I might decide on Monday that I want Friday’s dinner. That’s okay too. I just go with the flow. Sometimes, I make a menu for two to four weeks and just purchase for one week at a time. As the next week gets closer, I might change my mind or find some new recipe I want to try and change the menu. Also, if we didn’t make a dinner from the previous week, then we can push that dinner to the current week’s menu. 

6.

Use reusable items whenever possible. I’ve learned this recently as well. It is good for the environment and your bottom line. 

Instead of paper towels or napkins which used to add $10-$15 per month to our grocery order, I switched to reusable napkins. I purchased a 20 pack of flour-sack towels and these are what we use at the table instead of paper products. They get washed once a week and they’re low cost so it doesn’t matter if they’re not pretty. 

Also, we use storage or freezer bags much less. Instead of dividing items into potions in bags, I put them in storage containers in the freezer. It takes up a little more space but in response, I purchase fewer groceries and we experience less freezer burn that way too. 

Another reusable item is a silicone baking mat. These are amazing. I can use them for anything I’d bake in the oven including catching spills from a casserole overflow. Then I just wipe them with a cloth and soap – no stress.

7.

Spending freezes work. When I first started out, I didn’t go shopping for anything that I didn’t absolutely need. This meant that I didn’t go shopping at all. I didn’t shop online either. I was not capable of window shopping without buying things. I’m better able to now, but I’ll go shopping with a friend but not by myself if window shopping. Once I got all my household items that I needed for my first apartment, I stopped shopping. I only bought clothes when my son needed new ones or I needed to replace an item. 

Currently, I do a spending freeze when I feel my spending is getting out of control, when I want to add extra to my emergency fund, when I’m decluttering, or if I go over my spending money budget for the prior month. Sometimes I do a spending freeze because I don’t have any extra money for the month. 

If you do a freeze, and if you’re a person who has a lot of sales emails, you’ll want to unsubscribe. It’s very tempting when you get a $5 coupon off a $15 spend that will expire prior to the date your freeze ends. I try to look at it as a $10 loss, or a $10 clutter gain, to resist the urge to break my spending freeze when that happens. Then I unsubscribe from emails or text messages.  

8.

Take a waiting period for purchases. It’s common to wait two to three days prior to pulling the trigger on a larger purchase like a car or a house. We may discuss it with a trusted friend or significant other first too. Sometimes, I wait 24 hours on a smaller purchase to make sure it’s not an impulse buy – and it often is. I might also take the time to shop around or find a discount before making a purchase. I usually do a browser search to see if there’s a discount code available before going to a store to shop or completing an online sale. 

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9.

Create an emergency fund and a sinking fund for everything. This is another tip from Financial Peace University. An emergency fund is a money set aside in a savings account for when an emergency happens. A sinking fund is money set aside for a planned purchase. 

The Emergency fund. Dave Ramsey suggests beginning with $500 or $1,000 as a baby step. Then graduating to 3-6 months of regular expenses in savings. Once the goal is met, just let it sit there. 

Honestly, I have struggled to fully fund an emergency fund for a few years now. It seems that every time I make it to a couple thousand in the fund, something goes wrong and my fund gets depleted. I keep adding to it and refusing to get discouraged. I don’t make a lot of progress but every time something goes wrong I’ve got it covered. This makes it worth saving the 10% at the beginning of the month. That’s real peace of mind. 

Last year, my furnace went out. I had insurance to cover the machine and installation costs. I had to pay out of pocket for some minor expenses – I had the money in my emergency fund. This year my dishwasher broke and my water heater needed to be replaced in the same week. I had the funds to repair the dishwasher and pay for the out of pocket expenses for the water heater. Neither situation was the end of the world, I had an emergency fund. I also did not have to rack up my credit card to pay for these expenses. 

The sinking fund. This is how I pay for Christmas gifts, birthday parties for my child, vacations, and furniture purchases. It’s how we pay for our annual Amazon Prime membership and our real estate taxes and insurance expenses. Often an annual membership costs less than a monthly membership, so we divide the annual cost by 12 and transfer that to a savings account. 

This can be dicey but determine the cost you will need and then figure out how many months away the expense is. For example, we decide how much we want to spend and give for Christmas, then we save for 4 to 6 months for Christmas expenses. Some people save for eleven months. Divide the expense by the number of months and put that much into a savings account each month. This is extra beyond the emergency fund. If you don’t have money to save for the emergency fund and extra stuff, you’ll need to either not spend the money or figure out how to make extra money to pay for it.

Another option is to get a jar or a frame and put change or cash in it. This is a nice way to save for vacation spending money and if you use cash (see below).

To keep track a good method is to have multiple savings accounts.  If that’s not possible, keep track of what you’re saving and for what if you’re doing multiple savings using a piece of paper, a bullet journal, or an electronic spreadsheet. You can print savings trackers from the internet if you’d like to be creative. 

10.

Use cash as much as possible. This is another Dave Ramsey tip. It’s also an old-school tip from our grandparents. When you use cash, you spend differently. If you allot $50 for entertainment and restaurants and you have paper money in your wallet in an envelope then when you go to a restaurant, you’re less likely to spend the whole $50 at that restaurant. 

Another depression era (and Financial Peace) tip is to use envelopes for purchases. Decide which categories you will pay cash for – groceries, clothes, restaurants, dates, etc. Then go to the bank and withdraw the funds. Place the funds in the envelope. Only spend the amount of money in the envelope. Once the money is gone, there’s no more of that spending for the week, month, or pay period. 

11.

Pay off credit cards and don’t use them again. Credit cards are not emergency funds they are more like an albatross of anxiety and fear around your neck. Especially when you have to start over. Credit is a way to purchase things that you cannot afford with money that you don’t have. 

I have found that when I want the thing now, I’ve used credit to buy it, then I resent the payment later. Statistics show that you’ll not likely pay it off when you use the zero-down and no-interest periods. The fine print usually says that if you don’t pay the item off within the promotions period, or if you miss a payment, the company will add on the entire promotion period interest. That interest rate is often higher too – often more than 20%. 

12.

Do not use buy-here-pay-here, rent-to-own, cash advances, or title cash advances. Avoid them as if they were the plague, a serial ax murderer is in there, or you would become a slave the moment you walk in. All of these are true. Well, maybe there’s no ax murderer in there but you get it. 

If I have okay credit and go to the bank to get a loan before I go look to buy a car, I can get an interest rate that is about half of a buy-here-pay-here. When I was younger, had bad credit and no down payment for a car. At a buy-here-pay-here, I paid 24% interest for my first car. The last car I bought, after repairing my financial life and having a down payment I paid 4% interest at my bank and paid the car off a year early. My goal is to keep the car, maintain it, repair it, and then pay cash for the next car (see the sinking fund above). 

Cash advances and title advance places charge anywhere from 20%-60% interest. They are regulated by state law and maximum interest limits but that’s extraordinarily high interest. I’d rather pay a late fee than pay that much interest. These companies are usually placed in low-income neighborhoods or poor inner city areas, and they prey on the poor. It’s an awful business model but it’s legal. 

Rent-to-own places also overcharge. These companies also prey on the poor. I can get a very basic new sofa at a furniture store for about ⅔ the price (or less) of a rent-to-own store. The same with appliances and electronics. I don’t know if they charge interest but if they don’t they definitely make their money by overcharging. Also, buying used saves a lot of money. I purchased used appliances from the internet or an estate sale and paid about a quarter of the price of purchasing new. 

13.

Be grateful for what you have and don’t fall for the comparison trap. Studies show that when we’re grateful for what we have we are happier, healthier, and we spend less money. 

The comparison trap is when we compare our insides to our neighbor’s outsides. We are struggling in our family or relationship and our friend posts their 7-day cruise vacation on social media – they’re all happy and smiling. We suddenly compare our struggle to their happy appearance and decide a family cruise will fix the problem. I’ve found that if I am grateful for the specific things that I have I compare less. I find that when I identify that I have enough of something, I’m less likely to purchase an excess of that thing.

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Conclusion

The bottom line is that we handle money in the direction that our heart goes. We tithe when we recognize and trust that God will provide. We tithe when we see that we have enough, even to excess. We save and spend wisely when we exercise control over our money. We do better in our finances when we exercise self-control. When we are grateful for what we have we compare less and feel better about our lives. 

In the beginning, I didn’t use my savings account and never had any extra. As time went on, I spent all my extra. When I matured, I wanted to live a better life and wanted to stop living paycheck to paycheck. I also wanted to stop the financial stress that I caused using credit for everything. I wanted to live a life that I could afford instead of working to pay for my debt. 

It takes time to get on your feet after you’ve left an abuser. Having a financial safety net and financial independence will alleviate some of the anxiety that we have when we leave. We’re used to walking on eggshells and being afraid. We often have to start completely over after having lost everything. Maybe you had to live in a shelter, get divorced, and declared bankruptcy after leaving. Perhaps, you’re hanging on by a financial thread or swimming in an ocean of debt. 

Start small with that $500 or $1,000 emergency fund. Then take the next step from there. I have used Dave Ramsey’s Financial Peace University tips and some budgeting tips from various bloggers on Pinterest to make financial headway in all my problems. My husband and I are working through the FPU course again this year too so that we can be on the same page. 

The good news is that no matter what your financial situation it’s not too late to take control. Start where you’re at – where ever that is. Do the best you can with what you have. If you do, you’ll get better over time.  

What do you think? Do you use any of these methods to save money right now? Do you have anything to add? Comment below and join the conversation. I’d love to hear from you.


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2 thoughts on “What to do with Money When You’re Just Starting Over – Tips for Survivors

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  1. Thanks so much for this! I always feel like whenever I save a little bit of money my account starts dwindling and I have to start all over again lol but I’ll def be using some of these tips!

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