Beating debt and building wealth is not the norm.
Do you have debt? Do you know what you owe?
Author Ramit Sethi estimates that 75% of people with debt don’t know how much they owe. These are normal people.
How can you expect to beat debt and build wealth if you don’t know what you owe?
If you dream of finding financial freedom, you must address your debt head-on. Acknowledge your level of debt and create a plan to eliminate the debt, and start building wealth.
Budgets are controversial but can help beat debt.
Many people argue that budgets feed a scarcity mindset. This mindset is problematic when building wealth. You become so focused on the lack of money that you cannot focus on anything else.
It’s much better to have a plentiful mindset in life. See the half-full glass instead of the half-empty glass.
While budgeting can contribute to a scarcity mindset, it can also help you fully understand your debt and create a plan to wipe it out.
Budgeting helps identify areas of opportunity — wasted money. You can also use a budget to track your debts and create a plan of attack. Set target dates to eliminate debt and use your budget to achieve the goal.
A budget can be a powerful tool if you have debt like credit cards, auto, and student loans. You should be aware of the traps of a scarcity mindset and focus on the benefits of budgeting.
Most people don’t know what they owe because they are embarrassed.
The average American owes more than $6,000 in credit card debt. Many are embarrassed that they have built up their debt and have little to show. High-interest charges compound your debt as soon as you fail to pay your credit balance in full at the end of the month.
It’s a losing battle.
Inaction feeds the problem, and debt grows.
Learn more about when to fight or flee. Read – Running Into a Moose Is Kind of Like Financial Distress
You have to be able to move beyond embarrassment and take action.
Pull together all of your debts, tabulate the balances, and document the interest rates. Acknowledge your state and create a plan.
If you bury your head in the sand and hope the problem goes away, you will drown in debt.
Learn how to – Win by Being a Credit Card Deadbeat
Pick a debt paydown strategy and execute it.
Strategies for paying down debt are controversial. Some argue that you should pay the highest interest debt first, while others preach paying the lowest balance first.
Straight dollars and cents tell us that paying the highest interest balance first is wise. Psychology tells us there is merit to achieving milestones by paying off lower balances first.
I’m not here to tell you which method to choose.
Pick one and start executing the plan. The act of paying down debt now is most critical. The more time you waste debating a strategy, the more that interest compounds against you.
Use your debt balances and interest rates you collected before and start paying that crap off.
The sooner you start, the sooner you can beat debt and build wealth.
If you want to build wealth, it’s essential not to be normal.
Normal people are drowning in debt and can’t tell you what they owe. They have no plan to beat debt and no path to creating wealth.
Do the abnormal and take control of your debt. Acknowledge your debt and create a plan- then execute the plan.
It feels great to be debt-free and build wealth. Who knew being abnormal could feel so good.
Come join us.
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