Having a debt-free life certainly means a stress-free one—no creditors to keep on chasing you, and no money matters to worry about. The bad news is that most people today are so deep in debt that they are on the verge of losing hope that they can achieve financial freedom one day. There is no need to despair. With these top real secrets, you can be on your way on breaking out from your financial woes.

1. Look at your life realistically and live it that way.

Many financial experts would agree on this one, the first and foremost way to financial freedom is to lower your standard of living. When you are in debt, you do not have the option to quit your job, treat yourself to luxuries, or go on a vacation.

When you are in debt, you cannot do the same Friday night out routine at an expensive restaurant and bar that you have gotten used to nor buy yourself that expensive designer shoes as you always do. You can only do all these after you have freed yourself from your debts, but for now, all you need to do is be realistic with your expenditures. To put it in a gist—work extra hours, save more, and spend less!

2. Pay your debts. Pay them the right way.

This seems like the most obvious advice. But if it is so then why don’t people do this? Not paying debts would only bury you deeper into them. They will bury you in interest charges until you drown and not be able to breathe.

To do this right, first off, you have to make a list of everything that you owe. List your debts starting with the largest balance first. Aside from the amount, list also the minimum monthly payment and interest rate. Pay the debts in pile. Make double payments. Avoid paying just the minimum amount.

Paying minimum payments is financial suicide. It could take you a very long time to finish the principal debt and if you compute your payments, you see that you ended up paying four times the original charge! If you need to get a second job or work extra hours to do this, then do so.

3. Be wise in your credit card use and payment.

Credit card debt is a common problem not only in this country but in other parts of the world as well. People seem to lose track and focus when using plastic money. The fact that this is a “credit” tempts them to spend more than they can afford to pay for. First thing to do is to eliminate credit cards. One or two cards are more than enough. It is also not a good idea to roll over the balances. After paying off a card, notify the company that you are closing the account. Better yet, stick to using your debit card. Debit cards may not make you earn “points” but at least you don’t pile up the bills that would leave buried in debt at the end of the month! Be sure to keep track of your debit transactions so you don’t end up using your month’s budget for one shopping spree.

4. Start setting a budget for your expenditures.

Speaking of budget, it is important to know that money-smart people always make a spending plan. Keep track of the money coming in and going out. A personal finance software can help you do that. This would ensure that you don’t get to spend more than what you earn.

5. Consider consolidating your debt

Debt consolidation like credit card debt consolidation loan may be the feasible solution for your debt woes. But of course, you first have to assess your current financial situation and seek card consolidation credit debt help from reliable financial experts.

Ignoring your debts would not make them disappear. Running away from them or burying them into oblivion would not help either. Freedom from debt is surely a wonderful thing but it won’t happen magically. You need to do something to free yourself of debts.

By Sarah Lucy Smith



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