This is a post originally written for the Debt is Not Forever Blogger Crusade. The purpose of the Crusade, was to help people believe that they CAN get out of debt and establish a debt plan to help get them there. The crusade was started by Jackie at TheDebtMyth.com.
Many people are highly motivated to avoid debt. Sadly, as with many goals, it’s easy to lose focus and get off track quickly.
But, there is hope! With your desire to work hard to overcome debt coupled with these 10 ingredients to help you stay on track with your debt plan, I believe you’re highly likely to succeed this year!
10 Debt Plan Ingredients
1. Cut Up Your Credit Cards
Seriously, this is an oldie but a goodie. I mention it because it works. You don’t have to close all of your accounts, but you won’t be tempted to spend or increase your debt without credit cards in your wallet. Another option people sometimes use is to freeze their credit cards in water and putting them in the freezer, but this obviously isn’t as much of a commitment as cutting them up.
2. Build Your Payment Into Your Budget
For a debt plan to work, you need to have a place for your monthly payment in your budget. If you have to search for money every month to pay down your debt, you’ll never make any progress. Make sure your debt payment is prioritized at the top of your expense list in your monthly budget and you get the payment out of your account as soon as possible.
3. Be Patient
It’s easy to get into debt, but it’s difficult to get out of debt. It takes time, hard work, and patience. Once you have your plan in place, be patient and stay consistent with your debt plan. It’s the long-term patience and consistency that will help you achieve debt freedom.
4. Find an Accountability Partner
You may have gotten into debt by yourself, but you likely could use some help to get out of it. Find an accountability partner, such as a financial counselor, to help you create your plan, review it and hold you accountable to avoid increasing your debts with frivolous spending. A trusted family member or friend can also serve as a good accountability partner.
5. Look for New Opportunities
Who says you have to stick with your current debt plan. Throughout the year you may have opportunities to apply extra payments to pay down your debt further by way of work bonuses, tax return money, etc. You might even have the possibility to sell some things or make quick money to pay off your debts. A great strategy is to work a part-time job or use your skills to earn extra money.
6. Remember Your Reasons for Getting Out of Debt
If there isn’t something beneath all your desire, you’re going to fall back into debt as soon as you get out of it [see ways to avoid debt]. As an example, Christians can be motivated by their desire to be good biblical stewards and follow scripture that being in debt is like slavery (See Proverbs 22:7). For others, it may be some life related value that motivates you. Whatever it is, don’t forget about it on your journey!
7. Visualize Debt-Free Living
Along the same lines, don’t forget about your vision. What does debt free day look like for you? What do you plan to do with the extra money? Will you save more? If so, how will that savings make a difference for you and your family? Keep your vision in mind so you have something to charge towards when the going gets tough.
8. Shield Yourself Against Temptation
As I mentioned, cut up those credit cards, but there are more temptations that can impact your spending habits. If you like to spend money at the mall or stores, avoid going and find other things to do. If magazines make you want to buy things, stop looking at magazines and read more books! Figure out your spending weaknesses and guard yourself against them.
9. Review progress
It’s important to review your debt payoff plan and progress each month. In fact, why not make a poster that graphically helps you track your progress. You can display it for your family members so that everyone can see how close you are to your goal. Better yet, monitor your plan online using debt management software.
10. Celebrate Wins
If you have more than one debt you may have wins along the way to becoming completely debt free. If so, find ways to celebrate. There are plenty of ways you can have fun without using a credit card and going into more debt. Take the family to your favorite park or rent a move for entertainment, call all your friends and tell them you just paid off a credit card. Whatever the celebration is, make sure you can have some fun and take time to pat yourself on your back.
How do you plan to stay on track with your debt plan and pay down your debts this year?