A substantial portion of the population is in debt right now, every day of the year. It’s one of the most popular goals and resolutions, to get out of debt, yet so many of us never make it. Why? We are our own biggest enemy.
This article is going to overview how to set yourself up for debt free success, and to actually achieve your goals. Committing can feel good, but it won’t feel anywhere near as good as the success of achieving that goal – and you can do it. Just be aware that there is a space in between, where you aren’t happy about the measures you have to take but they are still necessary if the goal is important – and it is.
This article is going to set you up with some important questions to ask yourself when setting the goal. You are capable of being debt free, with some work and effort – and a lot of commitment!
Question 1: Why is this important to me?
We all have our own personal motivations for getting out of debt, but it’s important to understand what your personal reasons are. This is because these personal reasons are what’s going to motivate you in the time to come, and that time will not always feel easy. If you’re doing it because someone told you to, it’s not going to be nearly as motivating as if you know you’re doing it for the sake of your family.
If you don’t have a reason yet, take some time and think about it. Just a few minutes in a quiet room with you and a piece of paper. Think about the debt, think about why you want it gone, and focus in on your personal reasons. These will be what you hang on to in the months to come!
As a final note on this, if you are in a family, involve your spouse in the process. Don’t just goal to dig you both out yourself, sit down with your partner and discuss why you think it’s important to be debt free and what the plan is. Don’t make your partnership an obstacle, make it an asset – encourage each other!
Question 2: How did I get into this situation?
It is absolutely critical that you understand how you got into debt in the first place. This can seem like a painful experience, but the reality is that if you don’t understand what got you into debt you will likely repeat the mistake.
Be aware too, that it may be a medical reason or a job loss – this is not a blame game but rather an understanding one. By setting yourself up to understand how this happened in the first place, you can prevent it from happening in the future.
Question 3: How much can I afford to pay each month?
A lot of us want to be debt free and ambitiously plan to hurl our entire paycheques at debt until it’s gone. This may sound nice in theory, but is extremely impractical and sets you up for failure. Remember that bills will keep coming in as you reduce your debt load, and try to plan accordingly.
Sit down and figure out your expenses, and what’s leftover. That’s what you can afford to put towards the debt. This will set you up to realistically progress on reducing your debt, and keep the commitment up long after the enthusiasm fades.
Question 4: How will I get out of debt?
Becoming debt free is based on a plan. You need one if you aim to succeed. On top of knowing what you can afford to pay, know what sections of the debt(s) are going to be tackled first, what dates will be used, and which is the best for you.
Question 5: Is this a realistic plan so far?
If you’ve been reading along up to this point, you have a budget of what you can afford to pay and a plan for the order of how you’ll get debts paid off. Now it’s time to take a moment and ask yourself if you have set up a realistic, sustainable plan. If you haven’t, you’ll break it and end up feeling all the worse for it.
If it’s not realistic, re-evaluate. If it is, great, but be prepared to re-evaluate again later.
Question 6: Is there anything I haven’t considered?
Hand in hand with the assessment of the realistic nature of your debt plan is answering the question of other potential obstacles that could get in your way. Maybe it’s saving for a house, maybe it’s having a baby, maybe it’s a car breakdown. The bottom line is that you’re likely to encounter obstacles, and by noting those in advance you prepare yourself to make a plan to keep them from derailing your plan entirely.
Question 7: Have I forgiven myself for getting into this situation?
You’ve assessed how you got into this situation, but have you forgiven yourself for it yet? If you haven’t, you are just as likely to turn around and repeat the mistakes as if you hadn’t considered what they were in the first place. Self forgiveness is an important step in the getting debt free process.
Question 8: Do I have mental support and encouragement?
This could be a partner, this could be family members, this could be a good friend – the bottom line is you will need support along the way. No we’re not talking about money, we’re talking about some one who knows your goal and will support you by asking how it is going and encouraging you to keep persevering.
Remember, this can be quite the journey, so setting up a good support network is critical.
You can do this. You can make a plan, assess its realistic level, and succeed at becoming debt free. It will take time, persistence, and effort, but you can do it!