Whether it’s sky-high interest rates on credit cards, overwhelming student loan amounts,
or mortgage rates that you can barely keep up with, debt can be crippling.
For some people, debt is just a hole that keeps getting deeper and deeper.
In order to try and relieve some of the financial pressure,
they end up taking on even more debt to try and cover some of the bills.
Most banks and credit card companies are only too eager to provide consumers with more and more credit.
It’s estimated that just in America alone, an astounding 80% of people are in debt.
You read that correctly. Eight out of every 10 people are dealing with the burden of debt.
One of the greatest gifts that you can give yourself is the tremendous
feeling of relief that comes along with being completely debt free. By setting realistic goals for yourself,
practicing a little bit of self-discipline, and following a sound strategy,
it’s completely possible for you to rid yourself of debt. This is one of the best ways to become financially free.
The proper mindset
Getting your mindset right is the foundation upon which
all of your other efforts to eliminate debt are built, and having the right attitude
and being persistent with your efforts is one of the best ways to become debt free.
The first step is to make the definite decision today that you are going to get out of debt
and live a life of financial freedom, no matter what it takes. Develop an iron conviction.
Getting out of debt has to become the absolute highest priority in your life. It is your new number-one goal.
Once you are determined to make this happen, we can begin implementing
a strategy to work towards your new debt free lifestyle.
Get rid of unnecessary expenses!
First things first: The unnecessary junk has got to go.
It might not be the easiest thing in the world to do, but by doing what is needed now,
you’ll be setting yourself up for big success later on.
Similar to a gunshot victim in the trauma ward, the first step is to stop the bleeding.
You are going to have to take an honest look at all of your monthly expenses
and figure out what is essential and what can be eliminated.
Confront your debt head on
Once you’ve managed to trim your expenses,
it’s time to get to work on tackling your debt problem head on.
The best method we’ve seen when it comes to paying off debt is commonly referred to as the “Snowball Method.”
What you are going to do is make a list of each and every one of your debts.
Write them all out, and write the minimum monthly payments beside each of them along with their respective interest rates.
Now you have two options. You can either work on paying down your cheapest debt first,
or start by tackling the debt with the highest interest rate. Both methods have their own pros and cons.
By paying down your cheaper debts first, you can gain a significant psychological boost.
Individual sources of debt can be eliminated much quicker this way.
On the other hand, you are likely to save more money in the long run by
paying off the debts with the higher interest rates first. The choice is up to you.