In my experience I've found that its either it’s apathy, overwhelm or a combination of the two.
I want to help you identify which one (or both) is you and help you move forward.
Let's start with apathy.
You MUST be totally sick and tired of this, right?!
Ready? Let's do this! Just think about how much better your life will be in a year!
If you use this simple, 5-step guide as prescribed, your life is about to change for the better!
My intent in creating this resource is to very rapidly (in 6-8 hours max) get you past the most difficult, most overwhelming part of debt-elimination, and that is getting started.
Here’s how we’re going to do that:
Then, we’ll jump right into the 5 steps.
We’ll then look at the larger context of the “8 Steps To Erase Debt” framework that I personally used to eliminate over $43k worth of debt in 2.5 years. And we’ll build on the momentum you’ve gotten just by getting started.
Are you ready? Let’s go ahead and jump in!
Let's pause for some brief reflection. Your "why" is going to be your fuel to deliver you through this exercise.
Before we jump into the actual steps, you’ll want to solidify the answers to some very important questions.
This kind of “gut check” exercise will test how solid your reasons for engaging in this process.
“Why a gut check”, you ask? Because, even this “bite-sized” part of the debt-elimination process is hard, so I want you to arm yourself with the emotional ammunition you need to recharge your motivation when you hit a roadblock.
Put differently, I want you to come back to the answers to these questions when you’re tempted to walk away (and you will be).
Again, my goal here is to help you have a solid roadmap plotted out as to how you’re going to accomplish this quick-start exercise within the first 6-8 hours of starting.
Here is a short list of the ALL the forms and their download links we’ll be using for this process:
Time to find "true north".
Remember, I want for you to try and accomplish this (without being overwhelmed, of course) within the first 6-8 hours of starting.
So keep that in mind, pace yourself and reach out for help when you need it ([email protected]).
You can also book a free 30 minute call with me here when you’re feeling totally lost or overwhelmed:: https://calendly.com/zerodebtcoach/30min
Time to pause contributions, so we can use every extra dollar as a little soldier to exterminate your debt.
Go ahead and visit your 401k, 403b or other retirement online portal (probably Fidelity, Vanguard, etc.), or call your HR department and halt (temporarily) all of your retirement savings contributions.
I go into much more detail about they “why” behind this in my free 8 Steps To Erase Debt guide.
Suffice it to say for now, we want to free up ALL extra dollars to throw toward debt asap.
This step will pay huge dividends in helping you to move more easily through the next couple.
Download The “Everything I Owe" PDF Worksheet" Form and print it out.
This entails making a list of every bill, invoice, debt, expense you can think of. It might take a few “sittings” to remember everything. Don’t worry, it’s not going to be perfect. Just push through it for now and correct course as you go.
We’ll use this to populate your first budget in the next step.
The amount of time this will take really depends on your level of organization/disorganization, so have patience with yourself and take more time if you need it.
Remember, overwhelm will cause you to procrastinate or give up and we don’t want that . Employ the 25-minute time block strategy and try to stay on track.
It's just a written plan to tell your money what to do, so you don't have to wonder "where it went"...
Armed with the data that you’ve populated “Everything I Owe” form, you’ve made a giant leap toward getting your first budget under your belt.
Now that you don’t have to go searching for each and every expense, you will hopefully be able to easily populate the budgeting by pulling info from the “Everything I Owe” document.
All the instructions as to how to fill the Budget PDF Form are detailed on the form itself.
Being that this is normally most of my students’ most difficult task, feel free to book a free 30 minute call with me if you want/need a little bit of guidance
populating the form.
I also wanted for you to print out the Expense Tracking PDF Form so that you can go ahead and begin the habit of recording EVERY SINGLE DOLLAR that you spend. This will also make your budgeting efforts much easier and more fruitful.
You can book a free 30 minute call with me here: https://calendly.com/zerodebtcoach/30min
If you get through the budgeting exercise and you find that you can’t pay all your bills, you’ll likely need to stop this process and reference the following 3 resources:
If you’re in a situation where you can’t pay your bills, you will need to tap the brakes on this process and get to a place of solvency before you can continue.
Having coached hundreds of students through this type of scenario, I’ve seen first hand that it can be VERY complex and VERY challenging.
Again, if you need help and/or are overwhelmed, you can book a free 30 minute call with me here: https://calendly.com/zerodebtcoach/30min
Let's face it, emergencies happen. I want for you to be prepared with cash, so you're not pigeon holed into using "plastic".
Keep in mind, the actual execution (getting your hands on the $1000) could take upwards of a month or more, depending on the factors I outline next.
The “planning” will be brainstorming ideas for:
This planning could take upwards of 30 minutes to an hour. Like I said before, the actually execution will likely take longer.
Download The Debt Snowball Form and print it out.
With your “Everything I Owe" PDF Worksheet” form filled out and your budget written, you can take the debts form these two forms and roll that into this form, listing your debt from smallest to largest (regardless of interest rate).
Now it’s time to return to the 3 strategies we used to get your $1000 emergency fund in place:
This is no small feat. Pat yourself on the back!
And now, you may be asking yourself… “great Brad, but what’s next?”
Let’s talk about that...
Now that you’ve gotten through these very critical first 5 “quick start” steps, it’s important to keep the momentum going.
In order to have a “big picture” roadmap for where we’re going, I find it pivotal to introduce my students the 8 Steps To Erase Debt framework.
We use the “8 Steps” as a blueprint to lead them the rest of the way through the debt-elimination process and then on to more aspirational goals like “Financial Independence” (FI).
Once you’ve completed this “quick start” guide, I highly recommend that you download the free 8 Steps To Erase Debt guide to give you some more detail around each of the steps, especially after you’ve completed steps 0-3 and are ready to move on to steps 4-8.
Like I mentioned earlier, it’s super-critical that you build on the momentum you’ve established in this quick start exercise.
In a way, you’ve kind of “tricked” your mind into plowing through these first few steps. Brilliant!
Now, let’s keep your amazing accomplishment and momentum moving forward!
Do you Pinterest? Saving this image to one of your favorite boards could help someone "jump start" their own debt-elimination process...
As you’ll see, our “quick start” exercise was hyper-focused on steps 0-3 (below, in bold) of the “8 Steps To Erase Debt”. (Don’t worry, we’ll address Steps 4-8 more in depth when we dive into the full “8 Steps To Erase Debt” guide a little later on, but here they are for context.)
Step 0: Stop All Retirement Contribution
Step 1: Build A Budget
Step 2: $1000 Emergency Fund
Step 3: Debt Elimination Marathon (a.k.a. “The Debt Snowball”)
Step 4: 3-6+ Month Emergency Fund
Step 5: How To Invest 15%+ Into Retirement Accounts
Step 6: All about College Funding
Step 7: Pay Off The Home Mortgage
Step 8: Build Wealth, Serve, Be Ridiculously Generous AND Prepare For Financial Independence
So, now that we’ve got the first few steps “mapped out”, it’s all about follow-through/execution. Given your past history with debt and budgeting, you may need some accountability and perhaps even some coaching and teaching.
I personally believe that, if your “why” is big enough, you’ll be motivated to DIY (Do It Yourself) most of this.
0. Stop All Retirement Investing (Until Step 4)2. Starter Emergency Fund of $10003. Eliminate Debts Smallest To Largest (a.k.a The Debt Snowball)4. Full Emergency Fund of 3-6+ Months’ Expenses5. 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 Mortgage8. Build Wealth, Serve, Be Ridiculously Generous And Go FI (Financial Independence)!