How to Get Rid of Debt Forever

How to Get Rid of Debt Forever

In today’s society we are told that our worth is based on the stuff we have. It is in every advertisement out there. The house in the right neighborhood, determines what friends you will have. The car you drive tells everyone whether you are “well to do” or “eco-friendly”. The shoes you wear determines whether people at work will respect you. All the way to the type of beer you drink decides whether you attract that awesome looking person on the other side of the room. Does all this sound familiar?

We start to believe that we will only be accepted because of the stuff we have. Therefore we must have whatever that stuff is, now. We know that in the back of our minds that our value does not come from the sum of the stuff we own. I want to help you get past trying to get acceptance because of what you have so that you will be accepted and admired what you have done and can do. The main difference is, I want you to have all the stuff you ever wanted but I want it for you, not so others will like you.

So let’s look at the steps to get rid of debt forever!

Step 1: To get rid of debt: Know where you’re at.

Get a clear picture of what debt you have and what income you have. Yes you have to do the dreaded “B” word, a budget, but a simple one. Actually it’s more of a balance sheet. Figure out what you have coming in and what you have going out. This can be the hardest part. When you start to really look at this it can become daunting and sometimes depressing. Believe me, I understand! When I started this process, I found that not only did I owe more than I was making but the total amount was more than I could make in six years at my current income. Then when you start to think about everyday expenses like food, utility bills, gas for the car, and insurance, wow it doesn’t get easier. But it really needs to be all out there to look at, so you can deal with it!

Step 2: To get rid of debt: Get some breathing room.

If you are like most people you don’t have much in savings (meaning cash on hand). You really have to get something behind you so that when stuff comes up you can deal with it and not add debt. Do what ever you have to but you need 00 in the bank, FIRST! This takes a lot of pressure off, trust me. Only use it for true unexpected events.

Step 3: To get rid of debt: Start paying off debt.

DO NOT start this step till step 2 is complete! After knowing from step one what debt you owe, you will now know how much you owe each creditor and what the minimum payment is for each. After you figure what you have left after the minimum payments, add that amount to the creditor with the smallest balance you owe. Yes that means they get more than minimum., but it means they will get paid off quicker. After that one is paid, apply that amount to your next lowest balance creditor. Keep doing this and very soon you will be getting stuff paid off quicker than you can imagine.

Step 4: To get rid of debt: Cut the credit cord.

That is not a type-o, I said “cord.” Every time you pay off a creditor cut up the credit card or don’t take another loan. I’m not saying to cancel the card! Even though I don’t believe in the FICO or credit reporting, just for your benefit, leave the account open, just don’t use it! From now on you will be paying cash for what you want!

Step 5: To get rid of debt: SAVE, SAVE, SAVE

Only after you have payed off every thing except your mortgage will you do this step! All the money you have been paying out to payoff credit, you will now put straight into savings. There are plenty of ways and places to put this money but it does need to be accessible. Which means that you can have the cash within 24 hours if you need it. Save until you have an amount equal to 6 months of your bills.

Step 6: to get rid of debt: Invest.

Now that you have savings and no debt except your house, invest for college or retirement. Get with a reputable financial planner to help with this. Every state has different regulations, so it helps to have a professional help maximize your returns.

I hope that I have given you a good idea as to how you can get rid of debt forever. It is not easy and it may not be quick, but it works. I wish you the best and I truly would like to see you be able to live the life that will make everyone else want what you have, FREEDOM!

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