Personal Finance Interview with Lulu on Paying Off Debt Even When You're Poor for

No matter how much debt or how little cash you have at any given moment, feeling broke is really only a state of mind, says personal finance blogger Lulu.

And she knows a thing or two about owing a lot without making a lot.

"I was paying off debt, living daily and saving, all while making minimum wage and going through college," Lulu says. "Yes, it was very hard, but I saw people with had real jobs who complained all the time about being broke. I made very little but never considered myself to be broke."

Sure, she was poor because her income was around the poverty level, she lived paycheck to paycheck and she had to watch every cent, but she refused to let her situation prevent her from making headway on her financial goals.

Instead of people blaming outside forces for why they can't get out of debt, Lulu recommends they work with the resources they do have.

Her blog, How I Save Money, chronicles her journey as a 20-something-year-old woman working her way out of debt after being financially irresponsible with credit cards from a young age.

Here, she shares some of her favorite tips for saving money, sticking to a budget and using credit cards. Read on:

Tell us about How I Save Money...when and why did you start your blog?

I started the blog because I was bored and wanted to do something to keep myself occupied. When I began, I had no idea I would write about personal finances and I was actually inspired by someone who posted about contact lenses. I used to wear contacts, and I was looking for a product review and saw this thing called a "blog" where someone had many comments. I thought I could do something similar, and it was only after a few random posts that I finally decided on writing about personal finances.

Who should be reading it?


My blog is targeted toward people who are looking for simple ways to get out of debt and save money. I have read far too many personal finance blogs that assume people have a large income or have investments they can use to get out of debt. I wrote from my real experience of going to school full-time and working part-time on minimum wage and still managing to stay on budget.

How has blogging about personal finance helped you manage your money?

Since I started blogging, I began to find other interesting blogs that had what I considered to be more realistic ways to manage money. I have found sites that lead me to money-management tools like Mint and money-making sites such as Swagbucks. I have connected to other bloggers who have given me great tips on things to try, such as when I went through my CVS phase. I found out how to effectively use coupons and manage the use of credit cards to actually make money.

What have been the most surprising ways you've found to save money?

One of the most surprising ways I have found is to use deal sites. I had no idea there were sites where you could get all these discounts or coupons or even do your shopping via a portal and get cash back.

Another thing I have found is stacking coupons...where you can use more than one coupon on certain items. I loved doing that at CVS and getting lots of items for either a few cents or even for free!

What's surprised you most about your journey to pay off debt and make smarter financial decisions?

I was pleasantly surprised by all of the helpful and doable tips I found in the sea of tips that just did not apply to me. I was happy to find all the resources I did on how to manage money...did I mention how much I love Mint? As a graduate student, I taught a freshman class where I actually required my students to use Mint.

What are your views on credit cards? Do you use them or try to steer clear after paying off a lot of credit card debt?

I love credit cards! More specifically, I love cash-back credit cards. I did have some debt in the past due to a number of factors such as not knowing how to use cards responsibly, but I was able to get out of it.

Now that I have a better idea on how useful credit cards can be as a tool, it is my mission to get as many people as possible to use them. Just recently, a few of us went to the vending machines after a late class; everyone put in cash and I was last and used my card. As luck would have it, my item got stuck and we could not get it out. I called the vendor and two days later the money was back on my card. I would not have gotten anything if I used cash! I know this is a tiny example, but it works.

My best example of great credit card use is in regards to rent. I have to pay rent every month unless I want to get kicked out and live on the streets. I pay my rent with my credit card and I earn one percent of the amount as cash back. I let it build up and I can redeem for a gift card when I have $20 in rewards. So about every four months I get $20 for paying the rent, which I have to do anyway. In order to avoid interest and fees, I write the rent check to the credit card and never get any charges.

What's your advice on creating a budget that you'll actually stick to?

My advice is to do what works for you. I have helped some people make budgets, and they prefer to use cash in envelopes. I do not like that idea, but I realize that it is what works for them. So I say try a few different methods: cash envelope, virtual envelope, zero based, rotating, etc., and just pick the one that makes the most sense for your lifestyle.

Remember that a budget is not there to restrict you but to free up your mind because you see what you can and cannot afford.

How often do you review your finances? What sorts of numbers do you look at?

Well I am a little obsessive about it and I check Mint daily, but I am not poring over the numbers. I just like to log in and see what everything looks like. I take a look at my summary in Mint every week to make sure everything is green or yellow and to frown sternly if I do see a red bar.

When I log in to my Capital One 360 accounts, I just look at the section with pending transactions to see if checks have cleared or if payments have gone through. That is also done weekly, even though I used to record every transaction in a spreadsheet on a daily basis as well.

What are some of your favorite money-management resources?

I love Capital One 360, Mint, Swagbucks, and Credit Karma.

Follow Lulu on Twitter and Facebook.