How do you eat an elephant? One bite at a time.
Financial Guru Dave Ramsey is quick to point out that debt is cancer.
It enslaves us to jobs that we don’t like, places that we’d rather not live, and things that are worth less now than we acquired for them.
Whether or not you subscribe to Dave’s philosophy is up to you. I bring it up because I’ve personally implemented several of his philosophies and cannot explain how liberating it is to not only have significantly less debt, but also significantly more cash available to do stuff.
That having been said, unless you apply 100% of your salary against your debt, it’s going to take longer than just one year to get out of debt. Since you probably can’t go without food, water, clothing, toiletries, and the like for that long, you’re going to have to start taking small bites — just like eating an elephant.
I’m not going into all the details of how to do this, but the steps are fairly basic:
- Live within your means: don’t spend more than you make
- Pay off what you owe: minimum payments aren’t going to cut it
- Once you’ve found you’ve dug yourself into a hole, stop digging: stop using those credit cards right now
For complete details, grab a copy of The Total Money Makeover: A Proven Plan for Financial Fitness and get started.
As for me, my financial goals this year are to pay off:
- my Discover Card
- my car
- a line of credit
- and get a good start on another credit card
Doing so will represent around $25,000 in debt that I’ll no longer owe — and will free up around $900/month that would have gone toward feeding the debt-monster. But that money won’t be squandered — it’ll be put right back into the snowball to pay off more debt… stay tuned for my 2012 resolutions… 🙂