Debt Is A Monkey Nobody Wants On Their Back!

A lot of people just ignore their debt (I don’t know how they do it).

Then there are those wimps who are afraid to contact their creditors. They don’t really seem to understand the step-by-step consequences of not even trying to pay their bills, which I have laid out, in chronological order: 1) your credit rating will definitely be affected, 2) your creditors will seek a judgment in an effort to get paid, 3) your bill will be turned over to a debt collector, 4) your property might be repossessed and your wages may be garnished, and finally 5) you more than likely will be forced into bankruptcy.

While we don’t have enough time here for specific details of the often complicated measures people take in order to get out of debt, we do have enough to review the correct ways to start turning this problem around:

Pay off that credit card debt. Having a credit card that you pay off in full each month is perfectly acceptable (it’ll help you build up your credit rating) but having an outstanding balance that you have to pay interest on is a recipe for failure. Think of it like this: Calculate how much you pay in interest on your credit cards (not the balance, just the interest). Then figure out how much you would have if you had put that money into a savings account rather than into the credit card companies’ pockets. You should get the picture (I hope so, for your sake).

If you can’t afford it, don’t buy it. One of the main reasons that people go into debt (and consequently cannot even attempt to save money) is that they buy things that they can’t afford, by putting it on their credit card (bad, bad move). Even if you can eventually pay off the debt, the extra money that you had paid in interest will mean that you’ve paid more for the item than it was even worth in the first place.

Save money, then pay off debt. “Save up enough money to pay off my debts”, you ask? “Yes,” I answer! Start by figuring out how much debt you need to pay off, and then calculate how much you will need to save each paycheck in order to pay it off in a reasonable amount of time (don’t forget to calculate in the interest). Once you’ve gotten yourself out of the red, you can finally start working your way towards a healthy degree of savings.

Even the most responsible, intelligent and practical people on this earth can sometimes get overwhelmed by their finances (see, you’re not the only one). So if you’re one of those people who can never seem to save enough money, don’t worry! You are not alone. No matter how bad your savings habits are, there is always hope. And while it may take some drastic changes to your lifestyle, the steps I went over can really help you on your path to better savings goals.

Remember this: the temporary thrill that you get from spending money can’t compare to the pure satisfaction and sense of accomplishment that you’ll feel when you look at your bank account and see all the money you’ve been able to save.

The road to financial recovery will take total commitment from you. You’ll have to decide that you want to be debt-free. Then you have to find the discipline to take the necessary steps to paying off your debts. You, and only you, can determine if you are willing right now to make the sacrifices it takes to achieve this goal. Go ahead: do it and feel better about yourself!