Living Debt-Free is Possible .
The best strategy I could suggest is immediately changing your last strategy, i.e. look out for new ways to earn quickly with less possible expense.
Just for a start earn from home to get a breathing space.
Going into debt is very easy, but when it comes to paying it off, many tend to struggle. Almost every American adult has debt, and while loans are not always bad, one needs to be very responsible to avoid falling into a messy debt trap. You may find yourself borrowing frequently because it’s so easy to access, but eventually this mindset catches up. The question is, in the midst of all this, is it possible for a person to live a debt-free life? The answer to this will depend on how willing you are to commit to this goal. To make your debt-free journey much easier, here are steps that you can follow.
1. Identify All Your Current Debts
The first step to achieving a debt-free life is understanding all your debts. List them down and identify the amount you owe on each. These could be your credit card debts, student loans, mortgage loans or any other loan. Having them listed will reveal to you the reality of how deep you are in debt and most probably instill some healthy fear to help prevent taking out more loans. Once you know who you owe and how much you owe them, you can now decide how best to deal with the situation.
2. Look for A Smaller House
If you have a large mortgage loan, consider selling your house and moveing into a smaller one that you can comfortably pay for. This may sound like a major loss, but if you want to become debt-free faster, you must be willing to make such sacrifices. Once you settle your debts, you can set up a savings plan to be able to afford the big house later; that is if you still feel you need it. The fact is that some people will live in a big house for no real reason apart from wanting a luxurious life. Living in a big house is not bad, but it is only financially healthy if it does not make you fall into uncontrollable debt or make you struggle financially. Payments for the small house mortgage will be much less and therefore will be easier to settle.
3. Have A Payment Plan
Most people pay the minimum payment of their loans even if they can afford to pay more. In this case, the first step is to increase the amount of each paymennt. Remind lf that you must be willing and ready to settle your debts to become debt-free. If you followed the first step and went for a smaller house, increasing your installment payment shouldn’t be too difficult.
Alternatively, pick one loan and focus on settling it within the shortest time possible by paying as much as possible for every installment. In the meantime, maintain a minimum payment for the other loans to avoid accruing interests and penalties. Once you are done paying the first loan, pick another one and continue settling each until they are all paid off. This payment plan demands your willingness to sacrifice so that you can start living a debt-free life as soon as possible.
4. Work with A Budget
A budget is an essential tool when it comes to money management and a desire to attain financial freedom. In this case, get to know how much you earn and how much you spend every month. Your primary goal is to ensure that you are never spending more than you are earning, because that is one of the habits that buried you in debt in the first place. Trace all your incomes and expenses and list them down. Once you prepare the budget, analyze it closely and identify those expenses that you can do without to help you reduce your monthly expenditure. If you do not know how to go about preparing a budget, rely on financial experts such as those found at Mountain Ridge Associates. While they may not directly set up your budget, they will offer valuable services that may make the entire process easier. While having a budget is a crucial step when you want to become debt-free, the most important thing is your ability to stick onto it.
5. Set up an Emergency Fund
Apart from spending more than you are earning due to an expensive lifestyle, unexpected expenses can also drag you into debt. Therefore, if you want to live a debt-free life, you ought to be prepared for emergency expenses by setting aside an emergency fund. This fund is not the same as the insurance premiums you pay, and this means that you will still settle the premiums and save some money for expenses that go above and beyond. Next time you have an emergency you will not be rushing for a loan but can instead rely on the amounts set aside as a good measure for financial security.
6. Find New Ways to Earn Income
If you had more money coming in, most probably you wouldn’t have fallen into debt in the first place. Therefore, if it is possible, find new ways to increase your cash inflow. There are some easy cash earning methods promoted by young marketers who live well on those methods. Here is one – Earn Few Hundred Per Hour. More money means that your expenses will always remain lower than your income. You will also be able to save more for your financial goals. And finally, you won’t need to borrow anymore because you can now comfortably live within your means.
Sometimes your financial freedom is right within your grasp, and all you need is to have the willingness to control your spending habits. Always remain conscious of the money you are earning and spending so that you can prevent yourself from overspending.
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