GMR 106: The Right Way to Pay Off Debt
Episode 106
Living with debt has become standard for most Americans today. It's more abnormal to not be in debt than to carry consumer debt. Let's change that! You don't have to live continually being in debt, stressed out, anxious, and fearful of the future. In this episode of GMR, we discuss the process of getting out of debt and provide you with the tools to get started.
SHOW NOTES
The right way to pay off debt
ASK:
How did I get here?
What caused me to get into this debt?
If you don’t deal with the real reason you got into debt in the first place, and you somehow pay off your debt, you’re very likely to get back into debt again.
How credit card debt adds up
Credit card debt is usually due to emergencies, impulse buying, and living beyond your income.
Emergencies will happen and if you’re not prepared (savings) you’ll go to whatever available resource you can, to get through the emergency.
Never put medical bills or hospital procedures on a credit card!
Medical debt is usually non-interest bearing, while credit cards have high interest.
Impulse buying
Stuff you can’t wait to purchase or are unwilling to save before you spend.
Personal items - clothing, restaurants, entertainment.
Vacations.
TV & appliances.
Furniture.
Living beyond your income
No plan - no budget to guide spending.
Nothing set aside for non-monthly expenses.
No stability fund to provide for when the expense is greater than planned.
Do you have the ability to pay your debts? Run the numbers…
Make a list of all your debt
Make a list of your monthly “needs”, not wants
Determine exactly what your monthly surplus is...
Debt Snowball Tool
Create Your Budget Tool
Sell things around the house, cheaper vehicle
Pay all minimums and aggressively attack the smallest debt on your debt snowball list. Use wisdom with high-interest loans.
RESOURCES
Budget Forms and Tools
David’s New Book - Jesus on Money
David’s New Website - www.stewardshippastors.com