The process of getting out of debt starts with, earning more than what one spends, or spending less than what one earns. Is it that simple? Yes, it is that simple. Then, why is everyone not debt-free? It is because it involves self-discipline and determination. Is it difficult to become debt-free? It is not difficult if one knows what they are doing.
Visualizing, how awesome the debt-free life would be is the first step. Next, list down exciting possibilities of debt-free life. The list includes, the lifestyle they could lead, the relationships they could enjoy, the contributions they could make, the respect they could earn, and the reputation they could build. This powerful visualization and self-motivation should lead to action steps to achieve the goal of debt-free lifestyle.
First Of All, Document Everything in Black and White
Create a list of every single debt and group them into categories. The categories could be based on the interest rate, balance owed, or revolving type. How it is categorized is a personal choice, depending on how one wants to approach the process.
Explore All The Available Options To Get Out Of Debt
These options include, disposing of non-productive properties, getting rid of unused personal assets for cash, temporarily compromising for a less expensive lifestyle, and choosing to adopt healthy habits to stay on focus. Implement all the chosen options with vigor to experience momentum.
Never, Fall into Higher-Interest Debts To Pay The Existing Loan
This is one of the most critical things one should bear in mind before implementing anything else. Borrowing money to pay interest or to make payments will only make the situation worse. Classic examples are payday loans and title loans.
Seek Other’s Help To Get Out Of Debt
Dare to share the crisis, with well-wishers. Man is a social animal. Seeking help from genuine friends, and family could ease the situation and expedite the process of achieving the goal. It need not be a financial help. One could help with planning; another could provide referrals; someone else could give moral support and motivation.
Reward Yourself For Accomplishments
This self-appreciation helps a lot in accomplishing more. Whenever felt overwhelmed, it energizes and tends to produce better results.
Look For Opportunities To Cash-in Your Passion
What do you love to do; Taking pictures, Singing, Dancing, Writing, Or Blogging? Whatever be the passion, there should be a way to make money out of it. Find the right thing to do and enjoy the earning process.
Set Aside An Emergency Fund
Building an emergency fund boosts the confidence. Touch this fund only when facing a real emergency, and put it back once the emergency is over. Knowing, that there is need to panic when a crisis arises helps focus on doing the right things without anxiety.
Explore Different Debt Relief Options
Several types of debt relief programs are available to get out of debt. Debt Consolidation, Debt Settlement, Debt Management and Bankruptcy are some of the popular options. Doing due diligence is the key before jumping into any of these plans. Spend enough time in researching and comparing the different remedies. Most of these approaches require professional help. Take time to go through the reviews before choosing the company offering the services.
Staying out of debt is more important than, just getting out of debt. It is possible that some unexpected mishap forced the victim into debt; at the same time, falling into debt is different from staying in debt. Many experts consider that debt is only the symptom of a problem, and not the problem itself. Then, what is the real problem?
The real problem could either be overspending or under saving. The long lasting remedy for the debt relief should include behavioral therapy. When one just focuses on erasing the symptom, the underlying problem is left untreated and later they wonder; how come they are always in debt even after they were saved over and over.
Studies show, irrespective of the size of winning, most of the lottery winners lose all their winnings within years and come back to their original status. At the same time, the self-made millionaires bounce back from the defeat within a short span of time. Flipping the mindset is the key.