Cutting up the credit cards!!!
So how do you attack your debt with the intensity it takes to be able to reach the top of the mountain and scream I’M DEBT FREEEEEEEE!!!!
The debt snowball!!! As Dave Ramsey says “Personal Finance is 80% behavior and only 20% head knowledge”. We need to see the wins and celebrate the victories along the journey to keep us motivated.
List all of your debts out from smallest to largest, we don’t care about the interest rate, only the balances.
Make your minimum payments on every debt, except the smallest, pay as much extra to that as you can. Sell some stuff, work some overtime, do whatever it takes to throw every extra dollar at this debt.
Once you’ve paid off that smallest debt, stand back and think about the victory you just accomplished. You just eliminated a debt and now the snowball gets fun.
Take that saved monthly minimum from the smallest debt and roll that into the next smallest debt. You see where this is going!! Throw every extra dollar and eliminate that bad boy. Now roll the minimum payment from the first and the second debt. That’s how a snowball happens. It gets bigger as it rolls down hill. Do this over and over again until you have paid off everything.
It’s about the personal wins. The victories of marking out a debt and never going back to that place again. This is how you start to really win with money.
When surveyed, the Forbes 400, the richest 400 people in America, and asked what is the most important key to building wealth? 75% of them replied becoming and staying debt-free was the number one key to wealth building. What do the rich know and practice that the rest of us don’t? Being free from debt!!
Learn how to build financial strength in your first responder family. Get the tools and updates from one of your own. One the most trusted voices on finances in the first responder community. Subscribe to get our latest content by email.