Once upon a time, my financial situation was in an abysmal state. Broke, but stuck in an endless loop of spending and trying to impress others.
Anyone who has ever experienced drowning in the sea of debt will tell you how painful it is.
However, being in debt is not a permanent situation. Getting out of it is very possible. Here’s 3 proven methods to help you get out of debt.
Set Aside a Monthly Portion of Your Income For Debt Payment
The most important part of debt payment is , actually, paying it. Your income, at this point of time, should only fulfil two roles- survival and paying your debt.
You should not be setting aside money for holidays. You should not be attending any parties. You should not be at the shopping malls.
Set aside a reasonable amount of your income for your debt payment. Set a timeline that you want to pay off your debts. Be realistic. If you owe $24,000 and is only able to set aside $1,000 a month. Then stick to it and expect to pay off your debt in 2 years.
Do not forget to factor fees like minimum payment and interests into your plan.
Get Rid of the Small Debts First
You may be owing money to a few loan companies. One way is to get rid of the small debts first.
When we are able to overcome one obstacle at a time, we find motivation to keep going. This is called, “winning small victories” or “chopping down the monster”. It keeps us hopeful and help us see that the possibilities of success.
You will also have to factor in which loan company is charging you the highest interest. If there’s a company that is charging you a much higher interest than the rest, then it is advisable to tackle that first.
I am fortunate to come across Dave Ramsey at a time where I found myself in a messy financial state. I found his satirical way of educating his audience captivating.
If you are looking for get rich quick methods, perhaps you may want to look elsewhere. But if you are trying to find an escape route out of the lybrinth of money troubles, his message is clear and concise.
At our lowest point, it is vital that we find the proper support and guidance to help us navigate through the stormy seas.