Everything worth having takes some level of commitment. Commitment to honesty, marriage, values all help society to function and be stable. What better way to live financially than to commit yourself to live on less money than what you earn and to eliminate debt. Your first goal is to create a detailed debt reduction plan. Write down your debt reduction plan with target dates for compliance.
Implement your debt reduction plan while continuing to live on your controlled budget that you set up. One part of this method of debt reduction is to commit to not acquiring any new debt until it is paid in full. Another goal is to take money that has already been budgeted for debt reduction and commit to only use that money for paying off the loans.
If you can double the payment of the smallest loan it can bring you closer to debt reduction. Once you have the smallest debt paid off you’re on your way to debt reduction. Still continue in the process till the next largest debt is paid. Use this debt reduction method until all debts are paid in full. The only thing left should be the mortgage on your home. Once you have eliminated all the other loans, continue to live on a controlled budget and work at eliminating the house mortgage. Once the house is paid for try not to acquire any debt, it is important to have money for retirement and savings in case of an emergency.
The only way the debt reduction plan works is by changing your attitude about finances and looking at the future differently. By seeing the blessings that financial peace can bring, it will enrich your life as you focus on what is most important. Spending time with family and friends, service to others in the community are all great ways we can feel good about ourselves and society.
Another way to carry out this debt reduction plan is by getting the whole family involved. If you have children, include them in financial matters. Show them how to properly handle finances, budget and plan for the future and teach them ways to reduce debt. Give them the blessing of knowing how to control their wants and be able to be realistic about spending.
Another added bonus to teaching children about debt reduction is they will know the budget. It will help them to better understand why you don’t have cable or can’t afford to buy them designer clothes. It can teach self reliance by encouraging them to work hard and save their money for the merchandise they want.