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Raise your hand if money, more specifically debt, causes you stress.
If you are anything like me, you hate debt with a passion and that’s why you’re reading this post.
Well, my reason for hating debt is it doesn’t allow me to have what I desire without stress.
In the past, when I wanted something, I would charge it to my credit card and tell myself that I’ll just pay it off later.
This is probably very similar for most people reading this.
Well this caused a lot of stress for myself because I was the one in charge of our finances at home and I was also the knucklehead who was creating all of our debt.
I’ve seen many failed relationships and marriages where money, specifically debt again, was the root cause of arguments.
I definitely did not want this to be true for myself.
So my wife and I made the decision to become debt free at all costs.
Like most people at this point, I wasn’t sure what to do next.
So I began to research…..on Pinterest lol.
And there were tons of articles and posts about this topic. Some with similar or varying strategies.
So I found the most important ones and compiled this list, which I’ll share with you!
Three Simple Steps
These are the simple steps to take to become debt free
- Find your why
- Create a budget
- Debt Snowball your way to freedom
Step #1: Find Your Why
Your why is the reason why you want to get out of debt.
It can be as simple as you wanting to be debt free or it can be more complex.
But it is the driving force that will keep you focused on this debt freedom journey.
Let’s be realistic. Our debt isn’t going to just disappear quickly. I wish it would lol. However, it’s probably going to take some time.
So having a strong why is very important.
So this was our why when we started our debt freedom journey.
My wife and I both love to travel and explore and we have so many places that we have not yet checked off on our bucket list.
One of the places that we frequented as a young couple was a magical place down in Florida.
This place holds a special place in our hearts. I proposed to my wife underneath the castle at Magic Kingdom, spent our honeymoon there, and where we have made many lasting memories.
Don’t worry, we travel elsewhere lol. My wife’s a big outdoors girl so we‘ve visited many national parks and gone abroad (check out her adventure posts).
But wait, there’s more! Lol
Now our why has changed a tad bit.
We now have a new addition to our family!
A giant baby! (I’m 6’ 5”, so yea)
The newest part of our why is not only taking our son on our adventures (which means more money), but my wife wanted to be a stay at home mother.
Because we followed the next two steps, my wife was able to quit her teaching job to stay at home!
Step #2: Create A Budget
“By failing to plan, you are planning to fail”
Without setting up a budget, you will more than likely end up back going back to the spending habits that got you into debt.
I know this to be true, because it happened to me before I got serious about actively monitoring my spending habits.
I do not want to spend too much time on how to create a budget. If your interested in learning how to, you can check out my post on How to create a budget.
A budget helps you establish reasonable spending limits on the most important expenses that you have, eliminates the overspending that causes your debt to increase, and frees up money to be used on the next step of paying off debts.
Step #3: Debt Snowball Your Way To Freedom
Paying off debts quickly can be accomplished with the debt snowball method.
Essentially you make a list of your debts from smallest to greatest, and start paying the smallest debt off first.
The momentum created from this carries on to the next debt until all debts are paid off and your free of the burden of owing money.
If you’re interested in learning how to utilize the debt snowball, check out my post on Debt Snowball here.
Free At Last, Free At Last, Free At Last!
After each debt you gets paid off, there is a weight lifted off of your shoulders.
That weight is the stress debt creates in your life.
So just imagine the feeling you will have when you finally become debt free!
The sky’s the limit when you get to this point.
Our Next Steps
For myself, I needed to have a plan for this point in my life because I didn’t want to go back to reckless spending.
But I needed guidance for this, and that’s when I came across a well known expert in the field of money management.
If you haven’t heard of him or his best selling book, Money Makeover, then I highly recommend you get a copy of his book and check out his free podcasts!
In his book, he talks about 7 baby steps to follow that will give you not only a plan, but a foundation to build your wealth.
I could not have imagined being as confident in my financial future as I am today. And I wish I could have been taught this earlier on in life (like high school!) so that I didn’t have to struggle so much going paycheck to paycheck after college.
But the past is the past, and it’s time to move on to greater endeavors.
So if you enjoyed this post leave me a comment at the bottom.
Also, feel free to check out other posts I have put together. If you’d like to get updates on new posts as well as a free budget tracker, sign up below.