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5 (Un)Gentle Reminders Of Why You Need To Get Out Of Debt

Let’s get right to it.
 
You already know these 5 not-so-gentle reminders to get out of debt are true, you probably just need someone to enumerate them for you or at least to remind you of what they are. 
 
As your virtual financial coach, I'm happy to. :)
 
So here goes:
 
1. Your debt is actually stealing money from you, right this very moment. 
2. Debt is heavy and tiresome. I mean, aren’t you just sick of it? 
3. Think about how you’ll feel about yourself a year from now with less debt.
4. Earning interest is WAY better than paying it. 
 
Here's a handy-dandy infographic to illustrate:
 
 

1. Your Debt Is Actually Stealing From You Right Now 

If you’re paying interest on credit cards, car loans, student loans, second mortgages, first mortgages or any other type of debt, you’re literally being stolen from.
 
Strong statement I know, but stick with me.
 
If you’re paying interest, you’re basically “borrowing” money from your future self just so you can possess “the thing" right now (especially things that depreciate, like cars and consumer junk). So, instead of earning interest on investments or high-yield savings accounts, you’re paying it.
 
Think about it this way, it’s actually kind of like you’re stealing from yourself in a way.
 
If you haven’t thought of debt this way, it’s time you start. If you REALLY want to get out of debt, you’re going to have to change the way you think about it. 
 
You have to stop trying to either ignore what it really is or stop lying to yourself with soothing comments like, “everybody has debt” or “you’ll always have a car not. 
 
Totally untrue statements. Not EVERYONE has debt or a car note. I don’t and I would prefer that you don’t either.
 
Do you "get down" with Pinterest? Maybe pin this to your favorite board and help someone in your circle of influence convince themselves it's time to sack their debt?
 

2. Debt Is Heavy And Tiresome

I mean really, aren’t you tired of it? Aren’t you just totally sick of that tape running in the background, constantly reminding you that:
 
  • The payment is due on the 5th, so you’ll have to rob Peter to pay Paul
  • You can’t leave your crappy job because, “payments"
  • You can’t afford to take time off to take care of (insert family member), because you can’t afford to
 
If you’re honest with yourself even for a split second, you know this is a totally heavy and tiresome. Are you sick of it yet?
 
Maybe, you just haven’t believed there’s a way out until now. And, by the way, there is.
 

3. Think About A Year From Now

Now, I’m not going to be one of these surly “financial gurus” that says, “getting out of debt is easy, just follow these three easy steps and automate this and you can set it and forget it”.  NOPE!
 
Getting out of debt may be one of the hardest things you ever do in this life. Maybe. 
 
It MOST CERTAINLY will not be easy and will cost you far more than you can imagine in terms of: 
 
  1. getting outside your comfort zone and actually learning how money works,
  2. demolishing lies you believe about money,
  3. organizing both your life and your finances around winning with money and 
  4. learning the habit of constantly and consistently taking a fearless moral inventory of your life and of your finances.
 
But think about how things might look a year from now. Think about:
 
  1. your debt being eliminated or at least dramatically reduced
  2. ACTUALLY having some money to do fun stuff that you can ACTUALLY afford
  3. possibly being able to change careers and doing something you ACTUALLY love or at least don’t totally hate
  4. having the peace of mind that you’re on the right track and being able to rest better at night because of it.
 
A year from now can look FAR different than it does right now, I’ve seen it happen literally hundreds of times. But, it has to start NOW!
 

4. Earning Interest Is WAY Better Than Paying It

This one is super obvious, right? But I want you to really think about it.
 
Go ahead and add up all the interest you’re paying on your debts and just imagine what it would feel like if, instead of paying that to someone else, someone else was actually paying you.
 
You probably won’t do the exercise, but I know you can at least imagine it.
 
If you actually do the exercise, welcome to money working for you!
 

5. A Recession Is Coming

Update: July, 2020 - Well, it looks like the recession has arrived suddenly! With the Coronavirus/COVID19 pandemic currently sweeping the world, I put together a FREE Financial Crisis Survival Guide (blog post with available printable PDF) to help those of you either preparing for or responding to a cut in hours, layoff or termination.
 
 
Here's the free downloadable PDF version of the guide: Financial Crisis Survival Guide (Version: COVID19) Downloadable PDF version 

 

There’s always a risk of being called a “doomsayer” or “fear monger”. I actually don’t care. It’s actually just true that a recession is coming.
 
Do I know when? No. No one does, but it’s part of the cyclical nature of economics.
 
What I’m saying is that, if you persist in your lifestyle of ignoring your debt and haphazardly wandering into more of it, you’re completely denying the fact that a recession will hit again.
 
Where were you in 2008? Did you recover?
 
It will happen again, so let’s get you out of debt, so that you can actually (potential) better your situation when the next recession shows up, rather than being victimized (job loss, house loss, pension loss, etc.) by it.
 

Are You Ready?

So, in review we’ve looked at 5 not-so-gentle reminders of why you need to get out of debt.
 
1. Your debt is actually stealing money from you right now. 
2. Debt is heavy and tiresome. I mean, aren’t you just sick of it? 
3. Think about how you’ll feel about yourself a year from now
4. Earning interest is WAY better than paying it. 
5. A recession is coming. 
 
So, have I convinced you? Are you ready to start? Have you decided to come clean, do a fearless moral and financial inventory of your life and get going?
 
Leave me a comment below and tell me what you intend to do as a VERY FIRST step.
 
I’m eager to hear about the beginning of your journey to debt freedom!
 

The 8 Steps To Obliterate Your Debt

 
This is the blog post that outlines the 8 steps I followed to eliminated $43,000 in debt in 2.5 years.
 
 
And whether this is your first or thousandth time on the blog, I want to make sure you have this “8 Steps” framework that ALL of our content is centered around. 
 
These are the steps I personally followed to obliterate $43,000+ of debt in 2.5 years
 
Maybe your number is bigger, maybe it’s smaller. Either way the principles are the same and I want you to have them.
 
0. Stop All Retirement Investing (Until Step 4)
2. Starter Emergency Fund of $1000
3. Eliminate Debts Smallest To Largest (a.k.a The Debt Snowball)
4. Full Emergency Fund of 3-6+ Months’ Expenses
5. Invest A Minimum of 15% Income Into Retirement Accounts (and increase savings rate to 50%+ if possible)
6. College Funding (if applicable)
7. Pay Off The Home Mortgage
8. Build Wealth, Serve, Be Ridiculously Generous And Go FI (Financial Independence)!
 
I’ve created a simple, easy to follow guide that you can use as your foundation as you navigate the absolute annihilation of your debt forever. 

 

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When You Need More Help

And again, if you’re looking for some resources to get started, you can download our free budgeting forms. Also, if you’re in a place where you’re ready to kick your debt in the teeth, here's the link to our free “8 Steps To Erase Debt” guide for you to use as your foundation.
 
To your freedom,
 
Brad
 
 
This post may contain affiliate links. If you click & make a purchase, I receive a small commission (at no extra cost to you) that helps keep Zero Debt Coach up and running. Read my full disclosure policy.
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