In a perfect world, sailing through life debt-free could be no problem at all. But sadly, it doesn’t work this way for most of us. There is a mortgage to pay for an over-sized house, we must finance a new car because we don’t consider an outright purchase an option, and when we come face to face with emergencies, we use the credit card.
Carrying debt isn’t bad, but it all comes down to the debt type, the amount of debt you are carrying, the impact on your life, and how it makes you feel. We are actually talking about that type of debt which is not obligatory and is the outcome of the irresponsible spending that always seems to keep us in a pickle.
If you have made up your mind to defeat your debt for good, here are some tried and tested tips to give you a head start on the road to improved financial health.
Commit to Action – NOW
Maybe you haven’t noticed or you have ignored the fact that your debt problem has been eating you away for quite a while now, hasn’t it? You know how to fix it, but you feel a bit overwhelming. Why? Because when you give it a thought, it seems so far in the future until you are genuinely free from this burden.
Don’t just wait around to start dealing with this problem; taking action right NOW can really turn the tables. Work your way to a budget to see how much you can practically put forward for your debt at this moment, and simply begin. This key action will work as a strong motivator, and you will surely feel good. No matter how small that amount may seem, it is always better than nothing.
Choose a Strategy that offers Psychological Boost
For when the tasks that seem kind of hard, or when we didn’t see any significant results for a while, staying in the area of motivation while feeling confident about what we do, is absolutely vital. So, when it comes to building a strategy, you need to go for the one that would provide you with the most psychological boost.
Starting with the smallest balances and gradually seeing the credit card with no outstanding balance can really be uplifting. Or, perhaps you would like to begin with the largest debt that is weighing you down more. The idea of consolidating debt and just having one single monthly payment also shares quite an interest among a myriad of people.
If you decide to go for consolidation, you must establish the discipline to not use your credit cards once the credit has been paid off.
Stop Sabotaging Your Finances
Being over enthusiastic with a budget is the first step to a pitfall. So, you need to identify where you are hurting your finances. Do you know where are your financial blind spots? Are you overspending when you dine out, when you know cooking at home is more budget-friendly? Do you get overexcited with weekend outings? Do you turn to shopping when you feel bored or need an emotional boost?
The better you understand and control your money habits, the more effective your solutions are going to be. If you follow these tips, you are on the road to ridding yourself of debt for good.
What to do next after being debt-free?