Debt: GET OUT NOW!

Debt can be the single most debilitating "disease" we can have in our lives. When we have debt, we are, truly, a slave to the lender. It affects our relationships, our jobs, our joy (even though we feel that getting more stuff will make us happy). Getting out of debt frees us from the bondage it has on us. If that debt is affecting the joy of life, freedom is possible. If you have gotten into the habit of immediate gratification, spending more than you make, it won't be easy. But the habit that you made, you can break and create new and better ones.

When it comes to debt, the U.S. government doesn't set a good example. The amount of money the U.S. government receives each year is considerably less than what the government spends. That is just bad business. As of February 2019 the National Debt was 22 Trillion Dollars with interest being paid at 33 Billion Dollars a year. Can this be fixed? Do politicians care?. Starting a personal campaign to continuously communicate with lawmakers may make a difference to convince governments to mend their ways. But let's start debt reduction at the individual level (with us) first before pointing fingers at others.

When we say "get out of debt now", that doesn't mean you can just pay off all your bills and live free. It means "start, now, on the process of becoming debt-free". Be encouraged that you can do it and there are rewards. Generally, there are two schools of thought on debt reduction: (1) Some advisors recommend that you focus on the highest-interest debt and pay that off first. It makes the most fiscal sense, but it doesn't work for some people because the size of the loan is so discouragingly large. (2) That's why a second group of financial advisors recommends that you pay off the smallest loan first even if it's not set at the highest interest rate. They believe that, like dieting, even a small success delivers a significant amount of satisfaction. So paying off one loan will provide the incentive and motivation to pay off more and serve as a reminder that becoming debt free is possible. Only you know your personal motivation style, so choose the plan that works best for you.

• 1 - spend less than you earn
• 2 - avoid more debt
• 3 - build liquidity (Do not save what is left after spending, but spend what is left after saving - Warren Buffet)
• 4 - set long-term goals to focus on hitting a target

• Reduce recurring monthly expenses (a little inconvenience will result in big rewards)
• Eliminate or reduce addictions such as smoking, alcohol, drugs (put a $ amount to realize what you are paying)
• Create a Budget: Getting out of debt requires a plan. Creating a budget is your roadmap to a debt free life.
• Snowball Debt Payoffs: Pay off debt in order of smallest to largest, gaining momentum (and encouragement) as you knock out each balance. When the smallest debt is paid in full, roll the money you were paying on that debt into the next smallest balance.
• Reduce or Eliminate Gift Giving: Whether it's the economy, a desire to be more careful with your money, you're burnt out on getting and giving gifts that just clutter up your house and theirs, or a combination of everything above, it may be time to reconsider gift giving traditions. Consider that most people have the bad habit for immediate gratification and little tolerance to wait so they will, usually, get what they need or want on their own.
• Don't Waste Money on a Vehicle: It's a box on wheels expense with no investment value.
• Don't buy your wants; buy only what you need. Learn to Live on Less (Live Below Your Means): Is it really necessary to go to the 7-11 or Starbucks for coffee or have a 70" screen television?
• Reconsider Quality: Depending on what is being purchased and its purpose and necessary longevity, does it really need to be 'high quality'?
• Make, Grow and Reuse Your Own Stuff: Improve personal skills and reduce dependency on others which usually costs more money, may not be the best quality or just be a pain. Learn to become more self-sufficient and rely less on others and commercial products.