Dealing With Debt - Overcoming Your Problems

Debt steals your freedom; it's even more virulent than cancer. You must do everything humanly possible to get out of debt.

You're in debt today probably because you lived above your means in time past or got into a messy business that drove you into debt. Three things I hate most in this world, debt, poverty and sickness. Debt could have come from your inability to control your impulses or as a product of the unexpected. Whatever the case may be you have debt and we need to deal with it squarely and eliminate it.

My guide won't just get you out of debt rather you'll get out of debt way faster than you ever imagined.

Follow the following steps to get out of debt now:

1. Control Your Spending

You can't spend money you do not have. Therefore, if you want to be debt free, you must spend less money than you earn. Start by eliminating the things you don't really need from your scale of preference i.e.. learn the act of prioritizing. How much money would you have to spend if you eliminated newspapers, magazines, cable TV, second cars and cut back on eating out?

2. Decide How You Spend Your Money

Every charity, church and good program is asking for money. "Just give a dollar." These dollars add up. If you have a job and a good income you can spend as much as you can. But if you're trying to be debt free then don't let other people tell you how to spend your money.

3. List All Your Debts

This is a very important move; it shows your seriousness to become debt free. Get a piece of paper, a Google sheet or a notepad on your computer. This list will help you have a decent idea of how much you owe. This eliminates guesswork. Another important aspect is to rank this debt from the smallest to the most expensive.

4. Set Periodic Goals

Becoming goal oriented is the best gift you can gift yourself, in all spheres of life. Goals help us churn really hard matter into tiny pieces. From your income you can set a target to pay a certain percentage monthly. The big picture of this goal oriented mission is to pay off all your debt and regain your freedom. Once these goals are in place, it will be almost impossible to ignore them. This will push you faster into accomplishing your goals than you would have originally anticipated.

5. Start Paying Off Your Debt From Highest To Lowest

Take every penny you receive above your basic living and all of the savings and apply them to your debt, Start by paying the highest then narrow down to the least. One by one pay off your debt. This will give you confidence and help you become debt free

6. Sell Almost Everything

Sell the things you don't need to raise money. It could be your TV, used books, furniture, clothes. The aim is to raise more money and pay off your debt. There's always time for stuff when you're debt free so sell them and pay off your debt.

7. Work, Work, Work

This one is mind-blowing; To pay off the faster you can work more. Overtime, second jobs, babysitting. More money simply means more debt repayment.

Let me stop here for now.

Gideon E. Richards M.D

http://gideonike.com

I'm a medical doctor, blogger and avid reader. Above all things I love dishing out life changing tips. Thanks for stopping by to read my post.

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Jim Rohn: How to Solve Your Money Problems (Law of Attraction)

Jim Rohn: How to Solve Your Money Problems (Law of Attraction)

Here is an exciting thought! Why not work full time on your job and part time on your fortune? And what a feeling you'll have when you can honestly say, "I'm working to become wealthy. I'm not just working to pay my bills." When you have a wealth plan, you'll be so motivated that you'll have a hard time going to bed at night.

So if you will indulge me, I would like to share a simple formula for creating wealth. Here’s my thought on how money should be allocated.

The 70/30 Rule

After you pay your fair share of taxes, learn to live on 70 percent of your after-tax income. These are the necessities and luxuries you spend money on. Then, it’s important to look at how you allocate your remaining 30 percent. Let's allocate it in the following ways:

Charity

Of the 30 percent not spent, one-third should go to charity. Charity is the act of giving back to the community and helping those who need assistance. I believe that contributing 10 percent of your after-tax income is a good amount to strive for.

The act of giving should be taught early, when the amounts are small. It's pretty easy to take a dime out of a dollar. But it's considerably harder to give away a $100,000 out of $1 million. You say, "Oh, if I had $1 million, I'd have no trouble giving $100,000." I'm not so sure. $100,000 is a lot of money. Start early so you'll develop the habit before the big money comes your way.

Capital Investment

With the next 10 percent of your after-tax income, you're going to create wealth. This is money you'll use to buy, fix, manufacture or sell. The key is to engage in commerce, even if only on a part-time basis.

So how do you go about creating wealth? There are lots of ways. Let your imagination roam. Take a close look at those skills you developed at work or through your hobbies; you may be able to convert these into a profitable enterprise.

In addition, you can also learn to buy a product at wholesale and sell it for retail. Or you can purchase a piece of property and improve it. Use this 10 percent to purchase your equipment, products or equity—and get started. There is no telling what genius is inside you waiting to be awakened by the spark of opportunity.

Savings

The last 10 percent should be put in savings. I consider this to be one of the most exciting parts of your wealth plan because it can offer you peace of mind by preparing you for the “winters" of life. Let me give you the definition of "rich" and "poor”: Poor people spend their money and save what's left. Rich people save their money and spend what's left.

Twenty years ago, two people each earned a $1,000 a month and they each earned the same increases over the years. One had the philosophy of spending money and saving what's left; the other had the philosophy of saving first and spending what's left. Today, if you knew both, you'd call one poor and the other wealthy.

So, remember that giving, investing and saving, like any form of discipline, has a subtle effect. At the end of the day, the week, the month, the results are hardly noticeable. But let five years lapse and the differences become pronounced. At the end of 10 years, the differences are dramatic.

And it all starts with the same amount of money—just a different philosophy.

*CREDIT

Jim Rohn

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