I’ve been in debt since my first job at a department store when I was 16 years old where I opened up a credit card. From there I went to on to a plethora of other credit cards, car loans, pay day loans, student loans, lines-of-credit and home loans. I’m age 42 at the writing of this post, so that’s 26 years of my life that I’ve been carrying some sort of debt baggage around.
It’s pretty simple…to get out of debt, you HAVE to stop using debt.
Today I’m on a “get-out-of-debt” plan devised from learning the hard way, reading dozens of personal finance books, blogs and articles, and listening to financial podcasts on an almost daily basis. I’ve also found it very helpful to take part in online forums and Facebook groups. This plan didn’t develop over night, and it has taken a lot of hard work and sacrifice. So what do I do…
- I set a budget and follow it to the penny.
- I put any extra money to pay off debt at the sacrifice of other things I may want using delayed gratification
- I am always looking for ways to make extra money that I can pay toward the debt
- I live frugally, but I realize it’s impossible to deny myself everything
- I use a spread sheet to forecast my financial goals through the year 2030.
- I keep track of my net worth with a goal of $1 million in assets by retirement.
- I save for what I want and pay cash for those items
- I have an emergency fund of 3-6 months of expenses
- I invest, even just $40 a paycheck to stay consistent with that habit.