Debt Free! There are so many goals we are all striving to accomplish. There is one goal that I think needs more awareness and that is becoming debt free and saving money. However, it isn’t on everyone’s to-do list after having lunch with a friend one day. Before I share that story, here’s mine.
Being debt free and saving money has been on Colby, my husband, and my mind since we were engaged. We have always wanted to keep as much as possible and only go into debt for things we needed a home and car. Our saving paid off when I decided to quit work and stay home with our new baby. Colby had just finished his undergrad degree and was soon starting his Master’s. He had a great internship that would help cover our costs for the next two years without my income. This plan in Spring 2008. That’s right, 2008, before the economic plummet.
He lost his job, and there went any income. I remember sitting at our dining table one night with our 3wk old in his bouncer next to us and talking about our options. I was going to stay home with our baby. Me staying home had been a goal for both of us and the most important one for our family. Our savings had exactly enough to cover our expenses for one year. I told him he had to do a 2-year program in 1 year. We had no other options. This plan was our decision, and we prayed for help to let him finish in a year. It was a challenging year for him, but he did it! He got a job upon graduation in 2009. Our savings was gone, but we are so grateful to have had it.
Fast forward to years later. I’m having lunch with a friend who says she and her husband are attending a finance class. They have two children, and both are working. She told me that they are always challenged to keep $1,000 in savings, so that is what they were working to accomplish. Telling someone that “keeping $1,000 in savings was a goal”, which is OCD about saving, it hit me that not everyone has the same mentality.
Most want to save, but debt is the problem. Rather than let it overwhelm you, take control of it.
Debt Free; The First Step
Sit down and look at your debt. This task can be very hard, but writing it down is a requirement. Make a list of all your debt and place in order from smallest debt with a higher interest rate to a larger debt you have.
Take the #1 amount of debt on your list and start focusing your efforts on paying that off. Start by putting $20 (more if you are able) dollars a month extra towards that debt, on top of what you are already paying, figure out how long it will take you to pay that off. Once it is paid off, take those extra $20 plus what you were initially paying that 1st debt with and put it towards the next item on your debt list, and so on.
Debt Free; The Last Step
The idea is to keep rolling your money over a paid off debt into paying off another debt. You’re not necessarily pulling extra money from your bank account; you’re just making the existing “debt payoff” money work harder for you. This method will allow you to pay off debt faster and save on interest. You will be saving a lot in interest!
Another way that you can pay off your debt is to take the money you would have spent and decide to put it toward your debt. For example, if you want to order pizza, remind yourself of your goal and choose to take that $25 you would have spent eating out and automatically put towards paying off your debt! We figure, “well, we were going to spend $25 anyway, let’s spend it on our debt”. You would be surprised how often you choose to spend money on wants, rather than putting toward your needs.
Don’t give up. Stay focused. It’s ok to “get pizza,” but be mindful of the ways you spend your money. The relief that comes from paid off debt is liberating!
About Balance & Harmony 360², Inc.
Owned and operated by Melinda Smith, CPO®, we offer Business Training & Consulting with a Twist! Our sweet spot is working with Entrepreneur’s and their companies to create a productive work environment, happy home, and prosperous you! Our passion is listening to clients goals, thinking through solutions and coming up with creative 360² action plans that address work, home, and you! We also provide dynamic action oriented training to get your team motivated. Learn to Love Going to Work Again! Increase Time with Your Family! Get Things Done! Our process is simple and geared toward the professional. You CAN get your LIFE back in BALANCE!
Audrey Whiteley, CSE®
Audrey works for Balance & Harmony 360², as a Certified Staging Expert in the HOME Division. The home environment affects your health, productivity, and happiness. She works with individuals who need to freshen-up outdated décor, “show” a room’s potential or help homeowners create a lifestyle. Audrey makes the most of your surroundings whether you are staging for a quick sale, building a home, or want to elicit a more vibrant and peaceful setting in which to live.
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