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Debt Elimination: Important Key Concepts
By Molly's Brother | January 30, 2008
If you are wondering how to eliminate debt, then this blog is a great place to start. There are many, many creative ways to go about eliminating your debt. But there are some important and key concepts that lie beneath each of the strategies for debt reduction. It doesn’t matter if you are following David Bach’s plan or Dave Ramsey’s plan. What does matter are these following concepts.
1. You need to spend less than you make. While an easy concept for some to grasp, this might be impossible for others. Debt is created by the simple action of spending more than you earn. You can only get out of debt if you bring your spending habits under control.
2. Stop using the credit cards. You will never be able to get out from under your mountain of credit card debt if you continue to use your cards. It is already bad enough that the balance you are carrying is being charged an insane interest rate each day! Even if you do stop spending, your debt still grows! In order to stem the hemorrhaging, you need to stop feeding the debt. Leave the plastic at home.
3. Find ways to make extra money. An incredibly helpful concept: make more money and use this “new” money to reduce (and eliminate) your debt. Many of us aren’t able to benefit from astronomical wage increases at a current jobs. Therefore, we need to find part-time jobs that will help increase our income so we can decrease our debts.
4. Stay focused. I say this time and time again: You did not get into debt overnight. You can not get out of debt overnight. Debt elimination takes focus and perseverance. It will put an emotional strain on your relationships, it will be hard work, but it will be worth it. Imagine being able to sleep through the night without worrying about debt!
Topics: Debt |