I owed $30,000 in debt three years ago. I was making $35,000/year. Today, October 2006, I have no more debt. I got out of all that debt by changing how I thought about it, making hard decisions, and doing "whatever it took." I don't work in the business of money or loans. The only reason I've written down my ideas is to try to help other people. I turned 46 this year. So, here's my story.
I owed $30,000 in debt three years ago.
I owed $15,000 to my mom and had $15,000 in credit card and auto loan debt. I felt like I was in so much debt that I couldn't see the shore.
I made about $35,000 a year as a real estate agent. Creepy, huh?
Most people get into financial trouble by making bad decisions based on taking the easy, instant gratification, and lots of excuses path. This is how I got into trouble.
The only debt I have now is my mortgage, which I think of as "good" debt.
I'll tell you how I paid off my debts. These ideas are hard to put into words, but if you read this article carefully, my experiences and advice might help you live the debt-free life you've always wanted.
What has worked for me could also work for you if you are willing to take a harder path than the one you are on now. The choices I made to get out of debt only worked for me because I was willing to do "whatever it took" to get out of debt. This "whatever it takes" attitude was a big part of my success, and it will be a big part of yours, too.
Sell your "future self" into slavery:
Most people, including myself, like to take the easy way out in life. We do this without realising that the debt we create today will make our "future selves" slaves. When you get your credit card statements, your "future self" will have to try to pay for what you bought today on credit.
Why would you do that to yourself, if you think about it? You wouldn't treat a friend that way. That's not something you'd do to your Grandma. Why do you that? You have to learn to like yourself enough to not make this kind of slavery happen in the future. You can decide. You can look forward to a future of freedom and wealth, or you can look forward to being a slave to your debt. Don't give up your freedom by choice. Your choices can lead you to heaven or hell in the future.
When I learned this important truth, my whole view of life changed. I realised, "If I'm hard on myself now, my future self will have a gentler, wealthier life full of exciting choices if I'm hard on myself now."
Knowing that for sure, I started making the harder decisions. The options for delaying pleasure. The choice of being a slave to debt. I started to take the more difficult steps to get out of debt.
How I got out of being a slave to debt:
The first choice was easy: I stopped adding to my debt. Period.
Hard decision number one: I sold my house and bought a small condo. I lived by myself, so I didn't need a big house or a big mortgage payment. I moved from a home with 1400 square feet to a condo with 420 square feet. The amount I paid for my mortgage was cut in half. I paid off my debts with the money I got back.
Second hard decision: I got a second job. In my case, I started a business that cleans windows. Window cleaning is cheap to start and can make you a good living... I made about $24 per hour on average by washing windows. For my real estate business, I could set my own hours. I still work part-time in this business. This extra money helped me pay off my debt, and now that I'm debt-free, I'm saving it so I can buy a newer car with cash. By the way, I'll buy that car with cash.
Hard choice #3: The real estate market went crazy while I was trying to pay off my debt. I was one of the real estate agents who made twice or three times their usual pay. This boom lasted about 24 months in our area. Most of the agents bought themselves new, bigger homes and nice, new luxury cars. Not me. I was working hard to pay off my debt. I'll admit that I used to look longingly at the new cars in the parking lot of our office, but I knew that the good times would end and those easy payments would get harder to make.
Easy choice #2: Near the end of the "hot" real estate market, my little condo was worth about $30,000. I sold it and moved into a slightly bigger condo (800 sq. ft. vs. 420 sq. ft.) My mortgage payments were bigger, but I was able to pay off my Mom with some of the money I made. I bought my new condo with the rest. Now, I only owed about $9,000.
What was good, what was bad, and how I got out of debt:
I got a gift this year, and I used some of it to pay off the rest of my debt. The woman I was seeing at the time, Betty, gave me this inheritance. Betty, my sweetheart, died in December 2005 from cancer. She left me some money from her estate. Even though she wanted me to keep the money, I would have given it all back and everything I owned to get her back. It was bittersweet to be able to use this money to pay off my debt. Betty lived a happy, debt-free life while she was alive, and she knew how important it was for me to do the same. She gave me freedom as her last gift.
In the end, I got a surprise gift that helped me pay off my debts faster. I have a strong feeling that I might not have gotten that final blessing if I hadn't been willing to do "whatever it took" to get out of debt. I think that life gives us what we want as long as we are willing to pay for it. You might not have to pay the full price to get out of debt, but before the universe helps you, you have to show that you are willing to pay the full price.
It depends on you. You can get out of debt if you are hard on yourself. Make the tougher decisions. Take the path that is harder. Don't make yourself a slave to debt. If you do these things, your money situation will get better as time goes on. This idea is good. I dare you to try it. Then let me know how well you did.
