Debt Free For Life!Posted on Dec 30, 2011 | 20 comments
Sometimes you have a big day.
Finally, after 15 years, we are debt free. No more bills. No more loans. No more hassle. We are done. With the exception of our home(which we are in the process of selling), we are financially free! And this makes traveling the world seem a whole lot easier than it did before.
I am happy. I am. But I have to say, I sure feel like an idiot for taking 15 years to pay back some money I borrowed.
Had I thought about things a bit more and not been so greedy, I could have paid off my debt 10 years ago. I would have saved tens of thousands in interest. I would have had more financial freedom. And I probably would be traveling right now. But instead I got caught up in stuff like everyone else seems to do. I bought too much. I got the house. I built up my savings instead of paying off my debt. I accepted paying hundreds of dollars in interest each month just because it was easier.
I guess it helps knowing I am not the only fool out there. After all, nearly 80% of Americans are in debt, and that number is not getting any lower.
What is wrong with us? We're not stupid. And yet we keep doing stupid things like buying phones, houses, cars, TVs and vacations we cannot afford. We are sending our kids to schools that cost $50,000 a year while we are making $40,000 a year. We are buying houses with 2 car garages when we can't even afford the cars we are putting in them.
And how is it that we think we need gurus and books to teach us how to stop spending money and pay our bills? It's a pretty basic concept. You borrow and you pay back, or you just don't borrow. Have we become so insecure we can't even figure out how to pay a bill?
And why aren't we able to just say NO when it comes to spending money we don't have? Aren't we well off enough? I can't tell you how many times I have heard people on the news say they are "sacrificing" by buying less gifts or not eating out as much. Not eating out is a sacrifice? Really? What world are we living in here? For 90% of the earth's people eating out is a luxury! A luxury! I think we all need a reality check. We are lucky we don't know what sacrifice really means.
We need to stop complaining about our debt when $20,000 cars are in our driveways. We need to stop whining about bills when we're smoking a pack a day. $4.50 cents for latte? Seriously? We need to get it together. Stop being spoiled. Show some restraint. Pay our bills. And grow up.
80%? C'mon, we are better than that.
How We Got Rid Of Our Debt
I am obviously far from a genius when it comes to managing debt. And I won't make any promises that if you follow my "plan", you'll suddenly be debt free. All I can tell you is what we did and give you some ideas. This worked for us, maybe it will work for you. But the bottom line really is, and always has been, stop spending and pay back what you owe. Don't buy the latte when you still owe someone for last year's latte.
1. Minimize Your Spending & Cut Your Bills. If you don't need it, cut it. Turn off the heat. Drive less. I've been riding a bike for almost 2 years now. Cut where you can. Start today!
2. Use Your Savings. What's your savings get you, about 2% interest? Why save for 2% when you have debt that is charging you 10%. I made the mistake of holding onto my savings for years instead of just paying off my debt. I gave away thousands to banks. Pay off your debt today with your savings now.
3. Attack Your Highest Interest Debt First. Lay everything you owe out on the table and start paying off the bills with the highest interest. Forget how much you owe, just pay off the big dogs first and work your way down. I also suggest having everything online so you can make quick, free transfers and payments.
4. Pay Daily! I think this is the key to getting out of debt. Most of us have a tendency to spend money as we make it, so why not put this terrible habit to work for us. Whenever you get your hands on some cash, pay off your debt. I sometimes made payments 2 or 3 times a day. Just keep going, and eventually you will be in the clear.
That's it! That's all we did. I wish we had something more for you, but really we are talking about owing money. And how do you stop owing money? You just give the money back. Same as it was in elementary school when you borrowed that lunch money from little Sally Walker.
And for those of you who dream of travel, you'll be amazed at how possible things seem when you don't have the weight of your debt holding you back. I will never, ever again have any debt. This is in stone. Lesson learned; moving forward. Now, onto traveling.
Enjoy This Post? Stay Connected With Us.