Americans are deeper in debt than ever. Fortunately, more and more are getting tired of owing others and have committed to ditching debt once and for all.
They just don’t know how.
A few years ago I paid off $32,000 in credit card debt and have never looked back. I now pay credit cards off every month, have mastered my spending plan, and built up an emergency fund so I’ll never again be faced with the threat of having to incur debt. All of this was done without making a 6 figure income.
I won’t lie: the process was not easy or fun…but it was worth every bit of effort and sacrifice. In the years since getting out of debt I’ve had less stress and been able to build more wealth than ever before. If I was able to do it you definitely can.
Week one of your debt payoff: Commit to a better life
The hardest and most critical step in paying off your debts is making the firm commitment to do so. This means that, for a short period, you’ll have to say no to events, experiences and items far more often than you’ll say yes. I’d had one too many times where I didn’t have enough to eat or pay a bill, so as soon as I saw an opportunity to cut expenses and/or get a side job, I took it. My fear of not having enough far outweighed my desire to spend beyond necessities.
How to do it: Re-vision your life. What is it that you genuinely want for yourself? Go deeper than material items, to the place where you’ll truly find contentment.
I envisioned a time when there would be no lack of money. I was never a big spender, but I also wasn’t much of a planner, so whenever I wanted something I felt like I should be able to have it right then. Thus the reason I landed in debt. I had to begin to think beyond right now to something greater. What’s your something greater?
Think of something that personifies financial peace and freedom for you. I used paying cash for a vacation to Israel. Find a picture of your freedom if you can, and place it where you can see it daily. If you can’t find a picture, describe it in a journal and place a date as to when you’d like to accomplish this dream by, and the estimated cost.
My trip wouldn’t be easy or peaceful with bills hanging over my head, so I had to first pay off my debts and save an emergency fund. All the sacrifices I made, the experiences I did not have, was so I could take that trip to Israel with peace and serenity. Figure out what’s most important to you, and make sure it’s something you’re willing to commit to. Mine was a trip, yours can be anything, as long as it’s yours.
Next week, vision in hand, we’ll move on to the second most important element: creating a strategy.
And so it is.