The idea of where and How to Begin Paying Down Debt can seem so overwhelming when you are drowning in it.
It wasn’t all that many years ago, that I sat with my husband at a kitchen table filled with overdue loans, shutoff notices and collection bills, and no direction for getting out of the situation we had gotten ourselves into.
It felt like an impossible feat, but once we made the decision to change our financial perspective and fight for our lives things began to slowly turn around. Since that day, I have made it my mission to share my story and the hope of financial freedom with everyone.
Once you have a clear understanding of the kind of money you have to work with, you can begin paying down debt no matter how large your burden might be.
The main thing to keep in mind as you begin paying down your debt is that every forward movement you make counts, no matter how small if may feel.
I know how it feels when you are just starting out on your journey to get control over your financial life.
I remember thinking there was no way we would ever be free from our debt. We had been running on the hamster wheel of minimum payments for so long it became a way of life for us.
But I can tell you from experience that it is possible if you are willing to overlook the enormous debt elephant in the room.
The old saying “You can’t see the forest through the trees” is very true when it comes to debt.
Sure, when you look at all you owe it can easily become very overwhelming. I don’t know about you, but when I get overwhelmed it is in my nature to run away or choose denial.
Most times denial is the route I pick.
I want to encourage you to try something else when you are first facing your debt head on.
Here is a trick that we find works for us every single time:
- On a piece of paper write down every single person you owe and how much you owe them.
- Then rewrite this list starting with your smallest bill owed, until you have listed them all in order of amounts from least to greatest.
- Instead of looking at the entire list, just take a look at your smallest bill and plan to attack that one bill with all you’ve got.
- Set your mind to it to send that one debtor every single extra cent you can find each month until you have it paid off!
- Enjoy knowing that you do have the power to control your finances, and that one day you will be free from the bondage that comes from being in debt.
I don’t know how long this will take you since each of us have our own situations. But this does work as long as you are being a ninja about it. What do I mean?
Well you can’t cry about your finances if you are choosing to spend your money on things you want instead of things you need. Until you have completely paid off your smallest bill you need to get it through your head that you have NO extra money for luxury entertainment such as eating out, movies, etc.
If you sacrifice a little now you will be able to enjoy the things you like again without the guilt or shame that irresponsible spending causes.
It doesn’t matter how great a deal it is if you don’t have the money it is not for you! Click to Tweet!
Look for creative ways to earn extra money each month. You might have some things you aren’t using that you can sell on Craigslist, or maybe you can hold a garage sale or offer to babysit for a friend? Take everything left over after paying your other bills and drop it on you smallest bill until it is gone.
When it is gone, move onto the next smallest on the list and do the same thing.
I think it is natural to look at your biggest bill first because we want to get rid of them. But when you adjust your thinking to look at the smallest ones first, you can work to pay them off completely freeing up the money you were spending on that bill to use towards the next one on the list.
Nothing in your financial life is going to change unless you change the way you spend!