Want To Be Debt Free? Step 1 – You Need to Face The Music


You know how in the Galahads application we ask if there are skills you crave?  Yeah well “financial management” came up over and over.  You know how we ask you to declare your kick-ass goals?  Lots of GALS wrote “be debt-free”

I know that every single one of you has heard the term, “live within your means”.  Does it make you shiver in your booties?  Or shiver me timbers? Forget that…I don’t know what either of those questions mean.

But, the point is… there is only one way to get debt-free and stay debt free, and that is to spend less than you earn.  It sounds easy – but say those words to anyone and you will encounter extreme resistance.  The resistance comes from the fact that as soon as you think “live within your means” you stop thinking about the joys and advantages (especially for an entrepreneur) of being debt free and start thinking about all of the things that you will need to give up.  But do you really know what those things are?  Really?

Let’s just take it one step by simple step.  In Step 1 the only thing you need to do is face the music.  And eventually you will realize that whatever you find out is really not as terrible as you think.  Oh it will be hard, and it will life-changing, it just won’t be terrible.

So time to face the music.  It’s the hardest step.  You will resist with every fiber of your being.

Let’s start with a story about a client of mine  – we’ll call her Liz.

Once upon a time, a smart, competent, capable girl named Liz realized she was in financial trouble.  It actually surprised her.  She had always been so responsible with money and had never had any problems in the past.  But now with a family (including two children), two cars, day-care, a mortgage, etc… she could never keep up.  Even though she and her husband earned more than twice the national average wage, she still worried about getting her bills paid every month and had started to rack-up some huge credit card bills.  It was a never-ending spiral.

Feeling at a loss she decided to call LM for advice.  Surely she could give her the secret to getting out of the mess she was in.  This is what LM told her to do…

Step 1 – Face The Music

Mind your money.  And that means every penny.  Write down every single monthly payment as well as every cash penny you spend and every credit card charge for an entire month.  At the end of the month, categorize them - Utilities, Mortgage, Auto, Daycare, Groceries (ones that you actually eat…at a meal…at the table).  You know that cheeky little “miscellaneous” category?  The one that tends to hide all multitude of sins?  Rename it – call it “Discretionary Spending”.  And please…be honest.  Ice-cream for the kids at the mall isn’t part of your “childcare” category, a trendy new diaper bag isn’t either.  But maybe your kids aren’t your Achille’s Heel.  Tell your husband that a leather steering wheel cover doesn’t count as part of the “auto” category – and take-out for lunch every day at work can’t count under “groceries”.  Tell yourself that the fifth shade of lipstick in your quest to find the perfect red does not count as “personal care”.

Liz listened closely to LM, agreed with her, committed to Step 1 and then she… did nothing.  When Liz called LM to commiserate with her the following week, LM listened sympathetically and then asked her how Step 1 was going.

“Oh well I don’t have to do that – I already know all of our bills and I already know that we just don’t even have enough to get through the month”

Well, LM and Liz were actually pretty close.  LM had a very good idea what Liz’s expenses were – and when she added them quickly in her head, she know that her real expenses accounted for a little more than half of her income.

LM still talks to Liz all the time, and frequently about money.  But that first conversation was more than 10 years ago.


That really is Step 1 by the way.  And it really is that simple. But it’s not easy.

Here’s the reason that you must do Step 1, as well as the reason that Liz won’t.

Getting out of debt and living below your means is tough.  It requires that you take a long hard look at the lifestyle that you can actually, realistically afford – and you may not like it.  If Liz were to truly do step 1 and look the “Discretionary Spending” category in the face, then she would have no more excuses.  She would have to change her spending habits, which she believes would be inconvenient, uncomfortable and cramp her style.   She would have to really, truly want to get out of debt.  I guess she doesn’t really and truly want to… do you?

Don’t worry, Step 2 will soften the blow a bit.  Facing the music isn’t about figuring out all of the things you will have to live without.  You face the music so that you have real, honest data to make informed decisions about your spending priorities.  Liz’s primary focus is her kids, she doesn’t want them to miss out – so all she has to do is make her kids the priority over her lipstick.  Until her priorities change.  The priority for my family is travel.  We do without “stuff” so that we have the cash to fund our travel bug.

You really only need a pen and paper to do this exercise properly, but if you want to get fancy there are some apps like Expensify that make the task easier to track and manage once you get the numbers. My daughter is responsible for tracking our spending while we travel so she uses Receipts Pro on the iPad since she always has that with her.  But having the right tools shouldn’t hold you up.

Just grab a notebook and start TODAY.


(find out more about the Galahad’s Code Of Chivalry)
Defense — Defend yourself and your family against life's unexpected challenges - Get out of debt.
Courage — Have the courage to Face The Music - Document what you spend.
Franchise — Share your thoughts and challenges with other kick-ass women below.
Prowess — If you can't keep your personal finances in order you can't keep your business finances in order.


Avatar of Lisa-Marie Cabrelli

Location-Independent Entrepreneur & Certified Life Coach, Galahad, Wife, Mum, & Adventurer. Co-Founder of Galahads - The Secret Society for Kick-Ass Women. Founder & CEO of Emily Rose Doll Clothes and Wish Doll Company. Founder & CEO of Laptop Life Lisa. Finding the revenue and results inside every entrepreneur.   Mum of a rocking 14 year-old daughter visit her at TheOneAndOnlyEmTV.  Lucky wife of her soul-mate and fellow adventurer, Mark.  Traveling the world while running four businesses and raising a teenager. Journey from the last 6 weeks? Bahamas to Scotland to England to France to Switzerland, currently hanging in Borgo Val di Taro, Italy. @LaptopLifeLisa

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  • Beth Rabbitt

    I know that not everyone is a fan of Mint.com, but I have to say that the first time I felt truly in control of my finances was when I finally saw all of my accounts on a dashboard there. Suddenly I understood what my assets and liabilities were– what started as a one-off, unconnected process became one in which I could see the forest for the trees.

    • http://thegalahads.com/members/lisacabrelli/ Lisa-Marie Cabrelli

      Go Beth! Was planning on covering budgeting and finance consolidation in a later post so this is a great contribution. Mint.com wasn’t around when I started but Quicken was my introduction to total financial management. I believe everyone should have some central location for managing finances. It doesn’t have to be online like Mint.com if it makes you nervous but it should be linked to your online accounts for automated updating.

  • Whitney Johnson

    Nice post; and always a welcome reminder to be aware of what we are spending!

    • http://thegalahads.com/members/lisacabrelli/ Lisa-Marie Cabrelli

      Thanks Whitney!

  • http://thegalahads.com/members/michellefernandez-marino/ Michelle Fernandez-Marino

    Great post. I now have my homework to do for September. My goal is to be in total control of my finances by the new year (sooner if possible). Step 1 will get me on the path. Thanks!

  • Debbie Nguyen

    Being in control of your finances and knowing exactly how much you have to spend are a very important part of being in control of your life. I have been working on this issue for the past year and have made great improvements in regards to being financially responsible, and it’s nice to be reminded of the importance of being financially stable, especially from a fellow Galahad.