Are you in debt? Have you tried a number of times but couldn’t succeed in your attempts? The reason might be you’re lacking the right mindset.
Studies have revealed that an average American household carries about $130,922 of debt. Total debt owed by the consumers is $733 billion.
Read the following lines to know how to form the right mindset, which will help you to become debt free.
Take the entire responsibility yourself
First of all, be honest and admit what you’ve done wrong, as a result of which, you’ve incurred debt. It might have happened that a financial emergency has led you to the present situation; but, it’s ultimately your responsibility to manage your finances in a way to tackle such emergencies. However, this doesn’t mean that you have to blame yourself. Admit your mistakes and start planning a strategy to get out of debt. .
Make a promise to yourself not to incur additional debt
This is important. While planning strategy to solve your debt problems, do not incur additional debt. One of the best ways to achieve this is to keep your credit cards in a place where it’s a bit hard to fetch. . However, restrict yourself to spending much; otherwise, it’ll be difficult for you to solve your debt problems.
Decide you’ll get out debt come what may
To get out of debt, you need to make a promise to yourself - you will be out of debt come what may. This will help you form the right mindset. Most likely you’ll have to change some of your present habits. This might be a little difficult at first; but, you should realize that change is inevitable in life. So, it’s better to embrace the change as it’ll benefit you in the long run. Do not panic if you’re not able to change all your habits at once. It will take some time. However, every time you need to change a habit, remind yourself that you’ll have to stay motivated till you’re out of debt.
Promise to stay motivated till you pay the last cent
Even if you form the right mindset initially, it may become difficult for you to stay motivated especially when you’re dealing with large numbers. However, it’s not difficult to maintain the right mindset. In such a circumstance, you can follow debt snowball method to wipe away the smallest debts first. But, it’ll help you more if you follow debt snowball and debt avalanche together. Doing so, you can see your smallest debts bidding you goodbye and your high-interest debts shrinking, too.
Do not sacrifice your emergency fund so as to repay debt
Yes, paying off debt is necessary; but, building an emergency fund is equally important. By now, you might have understood the reason behind your falling into debt problems - if it’s a financial emergency. Think about a situation - you’re using all your money towards solving your debt problems and a financial emergency comes up and lands you into debt, again! No, this time don’t let this happen to you. Instead, .
So, I’m sure you’re already on the right track; you have started forming the right mindset to repay debt.
Do write your experience about your journey towards becoming debt free. It will surely inspire others!
Check out: Pay off debt - 4 Simple yet effective ways to manage it personally