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EPISODE 42 - SPENDING LOCKDOWN (Gillian and Ed)

NAME: Gillian and Ed
AGES: 25 and 27
ANNUAL INCOME: $97,000
DEBT ACCUMULATED: $70,000

GOAL: To be financially ready to move into their condo upgrade.

Gillian and Ed’s extravagant lifestyle and excessive spending threatened their upcoming move to a new and more expensive condo. The movers were set to arrive in nine months time and right behind them? The bankers and creditors.

Alison's Plan

A larger condo in 9 months meant twice the expenses, something Gillian and Ed were in no shape to shoulder. I gave them a plan to salvage their new condo.

  • First, they had to "Cut to the Bone". I challenged them to cut $2849 out of their monthly spending with cuts to everything from shopping and gambling to cash withdrawals.
  • Next, I urged them to "Restructure their Debt". I wanted them to hammer their high interest debt and bring it down to a manageable amount.
  • Finally I said, "Tally up the Move". They had no idea about the moving or closing costs ahead and entertained fantasies of new furniture in every room.

OUTCOME

Gillian and Ed are committed to repainting their financial picture. They’ve cut back on monthly expenses by $2400, eliminating their shortfall. They’ve tallied up their move, and have restructured their debt payments. They’ve even come to terms with keeping their existing furniture. If they continue to follow my plan, by moving day, they’ll have reduced their high interest debt to $8,500, and that means they’ll be in good financial shape to afford their new condo in the sky and make it their home.

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