Get Rid Of Debt In Your Life

Having debt in your life is not uncommon in this day and age but it should not be normal.  Choosing financial debt is a decision that you make but fortunately it’s a decision you can change.  Choosing to get out of financial bondage is decision you make not only for yourself but your family and those who depend on your financially.  Once you decide to be finished with debt in your life, you not only have to pay off the debts you currently owe but also have to stop borrowing money.  This is not as difficult as it sounds it’s just a decision away.

Getting out of financial bondage will require that you assess just how much debt you currently have.  If you’ve lived your life on borrowed money or spent many years borrowing, it may be a little unnerving to see just how much you actually owe but it is a healthy and needed step.  After you have sorted through your financial documents and determined just how much you owe, you can begin to actively pay it off.  How quickly you pay off your debt is up to you.  It is based a few different factors including, just how sick you are of paying interest on loans and your means to pay them off.  Whatever the reason, the sooner you pay off your debts the better shape you will be in financially and the more money you will save in the long run that can be used to fund your dreams and goals.

Most types of debt (not including medical debt) accrue interest that is compounded per some cycle period that could be yearly or perhaps monthly.  Just paying minimum payments on debt is a good way to just give away your hard earned money to the bank or lender.  You have several options as to how you pay off the debt.  As advocated by financial author, Dave Ramsey, you could pay minimum payments on each debt but your smallest and put all your extra money towards paying the smallest off as soon as possible and once its gone move on to the next largest debt and continue the process until you’re debt free.  You could also opt to perform the same type of process, except you start with your debt having the highest interest rate and work your way to the smallest.  You might choose to pay extra on each debt simultaneously as much as twice the minimum payment while holding off on paying off the mortgage until after the smaller debts are gone.  Whatever method you choose, be intentional at paying down your debts to eventually pay them off.  Don’t give up and keep moving forward, each step you take moves you a little closer to financial freedom.

Before you begin to enact your plan for paying off your debts, put away savings for a rainy day or rainy month.  Life always has its ups and downs and you never know what misfortune or emergency may come your way and by having at least six months of your pay saved up, you can be prepared if you need some money and quick.  You have changed your life and quit borrowing money and so credit cards and personal loans are no longer an option for emergencies like needed roof repair, buying a replacement vehicle or replacing your home’s HVAC system.  To help you stay on course with paying your bills, paying off debt, and moving forward with your financial plan, you should write and live on a monthly budget.  Living by a budget will force you to live within and hopefully below your means or force you to due with out.  A budget only works if you allow it to and is a key step you take to help you move forward to living your life free of financial bondage.

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