How badly do you want out of debt?

Let’s face it, debt is a huge problem. If you’re in debt, you know that feeling of dread when the bills come in and the balance isn’t what you wanted it to be. The worst part about being in debt is not having any money left over for fun things after paying off your bills each month. What do people do? They go into even more debt because they want to buy something nice or take a vacation but don’t have enough money saved up (or cannot get financing). This leads us to wonder: how badly do you want out of debt?

I don’t want to be rich. I just want my debts paid off… and then some.

You’re not trying to be rich, you just want your debts paid off.

You want the freedom to do what you want, when you want.

Like retire at 60 and travel with your spouse? Do it!

Or maybe start a business that requires lots of work and long hours? Go for it!

Do you know what your debt payments are every month? If you carry over a balance on your credit card, have you looked at the minimum payment lately? Even if you have a payment of $50 on a credit card, that could take decades to pay off if you only pay the minimum.

To calculate how long it will take for your debt to be paid off, use this formula:

Total Debt / (Monthly Interest Rate x 12) = Time to Pay Off Debt in Years

Say you owe $25,000 in student loans with an interest rate of 6%, and you make monthly payments of $250. You would divide 25000 by (6% x 12) and get 210 months or 20 years.

How many credit cards do you have? Why do you have them? Do you really need so many accounts?

Credit cards are not free money. They’re not even a good way to build credit. You should never obtain a new credit card just because you want the rewards, and it’s best to stay away from co-branded cards that offer points for your favorite store or airline.

If you do have a lot of credit cards, consider how many accounts you really need. Do all these accounts come with annual fees? If so, can you cancel them? Are there any promotional deals available for signing up for a new card which would help offset the cost of switching over?

What is something that costs more than it’s worth to you? Is it a meal at a restaurant that doesn’t feed your family enough or make them feel satisfied? Is it a pair of shoes that don’t fit quite right or aren’t quite what you wanted? Is it an item from a store that doesn’t accept returns (or doesn’t offer refunds or exchanges)? You’re probably being wasteful somewhere in your life.

• Don’t spend money on things that don’t give you value.
• Don’t spend money on things that don’t fit your needs or budget.
• Don’t spend money on things that don’t fit your lifestyle.

Are there things you want to do but aren’t doing because of money? Go on vacation. Start an education. Buy a car. Pay off debt so you can eventually retire and travel. For most people, these are things they’d like to do eventually. But for those holding out for someday, this list never seems to get fulfilled.

• Go on vacation.
• Start an education.
• Buy a car.
• Pay off debt so you can eventually retire and travel.

For most people, these are things they’d like to do eventually. But for those holding out for someday, this list never seems to get fulfilled—and it’s not just because of money but also because of time and other commitments (work, family). Unfortunately, the longer you wait until you start saving and paying down your debt, the more difficult it becomes when it comes time to invest in yourself or plan for something worthwhile later in life (like retirement).

Conclusion

If you want to cut out the waste in your life, it’s important that you start with what matters most. You can’t be wasteful with all of your money if you’re trying to pay off debt and save for retirement. So instead of feeling guilty about spending $5 on coffee each day, focus on where those dollars are going towards something important like retirement or paying down student loans.