Total Debt Elimination
Total debt elimination sounds too good to be true! We are actually talking about financial independence or complete freedom to do what you want with your money! Do not put your hopes into some wonder program that can wipe away your debt. There is no such thing. What you have to do is to regulate your consume, manage you budget wisely and reduce unnecessary expenses to the point where you can make savings and start repaying your debt in advance or before the term. Do not put your hopes in the money from retirement plans or from life insurance policies because this can be very tricky!
It all starts with debt reduction because you should not reach retirement age with further debt to cover. The issue is that the retirement plan may not provide you with enough money to cover your expenses and you may end up penniless when you most need it. Create a budget worksheet and see which of your expenses are justified by needs and which aren’t. Then you will realize that total debt elimination strategies require serious commitment and a great deal of involvement. You won’t be able to enjoy a debt free life if you have a gambling problem or if you have a shopping addiction.
A total debt elimination plan has to rely on the family income. Yet, you should take the unpredictable into consideration too, because in the context of the financial crisis anything is possible. What if you had to face unemployement? How would you handle debt then? This is a very legitimate question that you need to pay great attention too. Then, do not pay just the minimum amount for your credit card debt, because you will have to cover interest for a very long time before extinguishing debt. Credit companies have all the interest to keep you tied to them because you and millions like you are the cash cows.
For total debt elimination you have to use credit card carefully, and give up the concept of buying now and paying later. Then, do not take any credit card that is being offered to you before inquiring about the interest rate and the fees. The credit card should be chosen based on your borrowing habits. In fact, you could give up any borrowing habits that you may have. Total debt elimination takes great resilience, lots of effort and good management skills. Moreover, you will have to resist the consumerist trend and pay more attention to personal needs and unnecessary expenses. There’s tough work waiting ahead but with the right motivation you can do it!