Debt is an evil monster. A monster that makes you feel trapped and defeated. Debt suffocates you until you feel paralyzed and hopeless. It produces fearful uncertainty about your future and can crush your dreams.
Honestly, I am so ashamed of my debt. It fills me with guilt and anxiety. I want to hide and run from it, but I know that I can’t. How did I get here? Why was I so stupid? What can I do to get out of debt? Will I ever get out of debt? I have failed in so many ways when it comes to money.
Maybe, you feel the same way about debt. You feel overwhelmed by what to do or where to start to get out of debt. Believe me, I can totally relate. I would love to be one of those bloggers writing “How I paid off $50,000 in Debt in 18 months”, but I am not. I am still in debt and have been for many years. However, I am on my journey to be debt free. It will be a LONG journey for me, but I have to start somewhere.
I don’t know where you are on your journey of becoming debt free. Maybe, you haven’t even started yet. However, I believe that we all want to be free from the financial prison of debt, the shame, and all the other ugly emotions that go along with being in debt. There is no better day than today to start your journey to financial freedom.
Once you finally have the desire and the determination to become debt free, you might wonder where to begin. Before you can actually begin the journey of becoming debt free, there are some steps that you must take first. These steps can be scary and ugly, but in order to progress in the right direction, you must face the facts.
Admit and Accept your Failures
You have to admit to yourself that you have made some unwise choices when it comes to money. We all have failures in our lives, and we all have experienced at least a few failures when it comes to money. I have had many failures when it comes to money. However, I have to recognize and accept these failures in order to learn from them. Not wanting to admit that you have failed will only hinder your success in becoming debt free. Analyzing your failures and mistakes when it comes to money will teach you how to wisely manage your money in the future. These are lessons that need to be learned in order to move forward in your debt free journey.
How Did You Get Here
In order to tackle your debt, you must identify how you got here. What choices have you made or excuses have you used to accumulate debt? I have multiple excuses and reasons why I have debt. Often, I have told myself that I work hard and deserve whatever I buy or I want to give my kids what I never had. Many times, I convinced myself that I needed something when actually I really just wanted it or thought I needed it now and could have waited. Believe me, I could go on and on about my excuses and unwise money choices. Maybe, you can relate.
Theses excuses and unwise choices must be exposed and dealt with. We need to change our ways and our mindset when it comes to money. Spending money is often connected to emotions or experiences that we have had in the past. Today is the day to deal with these emotions or experiences. Only then, can you change your mindset and focus on your actions needed to become debt free.
To truly own your debt, you need to know exactly how much debt you have. Total all your debts except your mortgage, and I mean everything: medical bills, student loans, personal loans, credit cards, etc. It might be scary, but you need to know exactly what you are dealing with, not a ballpark figure.
I will share with you that I have A LOT of debt. Believe me, I am not proud of my debt, but I share this with you because I want you to know that you are not alone. My debt is well above the $16,000 average household debt of most Americans today, and it scares me to even think about it. However, I have to own it so I know the monster that I am fighting. Remember, you cannot conquer your debt if you don’t know what you are up against. Be brave, own it.
Stop Using Credit Cards
Cut up your cards or lock them up and throw away the key. The point is do whatever you need to do to stop using them. You have to be serious about this step. The fact is that you will not get out of debt if you keep using your credit cards. I know this might seem like a no brainer, but you might be tempted to use your credit card for one small purchase here and there. Do NOT do it!! It’s a trap. Believe me, I have fallen into this trap many times before. This behavior will not produce the results you want. You will be tempted to use your credit cards. However, if you stand firm, it will get easier. Keep your focus on being debt free, and you will succeed.
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Make a Plan
After reading Dave Ramsey’s book, The Total Money Makeover, I realized that you must have a plan to tackle your debt. A plan will help you manage your money and produce results that will keep you motivated in your debt free journey. Here are some crucial steps that you need in your plan:
Create a Budget
This must be the first step in your plan. List all your monthly expenses and income. The budget will show how much money you have left over after expenses that can be applied to your emergency fund. If you have nothing left, it can also give you an idea of what expenses you might be able to cut out or reduce in order to create your emergency fund.
Save $1000 for an Emergency Fund
Work on creating an emergency fund before paying extra on your debt. Find multiple ways to fund your emergency fund, such as working side hustles, overtime, selling items on Craigslist, having a yard sale, or cutting expenses in your budget. Your emergency fund will help you to not use your credit cards when unforeseen expenses arise. Remember, this money is for emergencies only.
Tackle Your Debt
List your debts from the smallest amount to the largest amount. While paying the minimum on all other debts, pay any extra money that you may have on the smallest debt until it is paid off. When the smallest debt is paid off, add that minimum payment and extra money to the next smallest debt. Continue this cycle until all the debts are paid off. Depending on the amount of your debt, this may take a while, but don’t give up! Celebrate the debts that you pay off along the way and keep your focus on being debt free.
Debt can be scary and sometimes seem impossible to overcome. However, these simple steps can help you tackle your debt and get you on the road to being debt free. I look at my debt and often wonder how I will ever be financial free. However, we all have to start somewhere. Debt can be conquered and crushed. We just have to stay focused, steadfast, and determined.
Are you ready to conquer and crush your debt? I know that I am. So let’s take this journey together and motivate one another to stay focused on our goals of becoming financially free.