8 Tips On How To Become Debt Free
One of the most
common questions I get asked when it comes to money is how to become
is always the same. You need to follow
the practical rules of money, but you also need to change your
Albert Einstein is quoted as saying 'We cannot solve our problems with the same thinking that created them…' and this is so true.
written a fair amount in an earlier post about managing debt where I cover the
basics to this question and give you the practical ‘doing’ side of the answer.
But I want
to focus today on how to become debt free from another less accepted, but just
as important angle - your mindset.
In fact you
could argue that your mindset is actually the most important aspect because it
governs your feelings, thoughts and actions… which bring about your experience.
How Did You
Get Into Debt?
A lot of
people who aren’t in debt equate it with overspending on big TVs or expensive cars. And whilst that may be the case for some, there
are lots of other scenarios.
For example, I got into
debt when a business of mine failed. Coupled with my lack of foresight at the time,
this put me in a very difficult situation to say the least.
reason could be illness or an accident resulting in unexpected and large medical
bills and maybe the inability to work.
Each path will result in different emotions, depending on how your debt came about.
You may be
feeling angry at yourself for overspending or for not having the foresight to
take out some kind of income insurance if you lost your job, for instance.
You could be blaming someone or something else as the reason for your financial crisis, and feeling like a victim.
you’re feeling a large dose of self pity – why me? It wasn’t my fault the GFC came along and
wiped my business out.
bottom line is – no matter what your circumstances are, debt has arrived on
your doorstep and no amount of soul searching or playing the blame game is
going to take it away again. What you
need is a new way of thinking about it.
point (and the sooner the better) you have to put a stop to those negative
thoughts and accept that you are in this situation, and that if you knew better
at the time you wouldn’t be. But by and
large you were doing the best that you could back then, so lesson learned, time
to move on.
You have to
let go of all those self sabotaging emotions of anger, self pity, even lethargy
(what’s the point?) and fear.
Then turn your focus to how to become debt free as fast as possible.
so many examples of people who have fallen from grace financially, only to rise
from the ashes to achieve even better financial and personal success than
before. And nearly all these people
actually feel gratitude for the wake up call they got.
nothing happens by mistake. There is no
such thing as fate. Usually there are many, many warning signs leading up to the final situation. Unfortunately these warning signs are often only
apparent to us after the event, but you can learn from them so you don’t repeat the
How To Become Debt Free – The Role Of Your Mindset
Feed your mind with positive ideas...
it takes to feel better on a daily basis – read motivational books, read about
others who have paid off a mountain of debt on average wages, like Stephanie Hood, who paid off $90,000 in 3 years. Jackie and Miles Beck who paid off $147,106 and Shannon Brown who paid $22,047 of debt off in 9 months. There are plenty more stories where they came from too.
The end result is you'll realise you're not alone and will begin to harbour a belief that this is not the end of the road, this is just a little blip and it may very well be just what you needed to rise to greater success than before.
Acknowledge your part in the situation...
jump up and down telling me it wasn’t your fault… take a look at the real
reason you’re in debt. If it’s an
illness, it could be that you chose not to take out either medical insurance
and/or income protection insurance. I’m
not talking about blaming yourself – but acknowledging it was your choice.
business situation like mine, my choice was to continue even though there were
warning signs, because I didn’t want to admit defeat… the downward trend in
business wasn’t my decision, but how I reacted was.
Take responsibility now for your thoughts and feelings...
Only YOU can change them. Start to see what makes you feel great, what
brings you down. Focus on the things
that uplift you. This may seem unrelated
to your debt, but how you are feeling has a huge impact on the decisions you make.
Don't hang around angry broke people...
loves company as the saying goes and it’s amazing how much you let yourself off
the hook if you spend time with others who are broke and complaining about
If you start talking about how you’re going to pay off your debt within 12 months, it forces them to confront their own lack of action, they feel even worse about themselves and so they will feel the need to bring you back down to their level by telling you that it’s impossible. It's just best not to go there.
growing positivity with your life!
planting a tiny seed in a pot – some exotic flower or beautiful fruit tree you
want to grow. How will you nourish it? You’ll make sure it has enough water – but not
too much, enough sunlight, but not too much.
You may even talk to it or sing to it :) ... Whatever you do, you take care of
it to nurture it until it grows strong enough to resist the wind and rain it
may face in your garden.
You have to
do the same for your new mindset. Don’t
stand out in the wind and rain before you’re resilient enough to ignore it.
Set a plan
and a goal
reason for paying off the debt. I
have to be honest, to start with for me it was just being able to sleep at
night. But as the debt started to
diminish, I started thinking about slightly more ambitious plans; like taking a
trip to visit family, getting a garden service to keep my garden in shape instead of
doing it myself. So don’t think you have
to have some massive goal (although if you do that’s great!), but do start
thinking about what your life will be like once you’ve paid off your debt.
from your daily awareness.
Set a payment
plan and put it on automatic. This sounds
like a practical aspect, and it is. But the
end result is that you are not constantly thinking about it – so you can focus
on positive, fun things again.
you have a life!
Set up your
repayments so you do have a little wiggle room.
Movies with the kids on weekends or a date night with your man once a
month… Having some fun in your life will help to keep you in a positive frame of mind.
act on all these tips or just some of them, the main point I really want to get
across is not to ignore the role that your mindset plays in how you're going to become debt free. Your whole
experience can change just by changing how you think about it.
these mindset tips have given you another angle on how to become debt
free. If you have any others (and I’m
sure there are lots!) please share them below… I’d love to hear them!
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