The journey to debt freedom requires a lot of deliberate work especially for those with a lot of debts piled up on their plates. It can be quite overwhelming just trying to figure out where to begin I tell you. Dave Ramsey said once that getting into debts is similar to taking an elevator to a destination but getting out of debts is like taking the stair case. A long way to go!
No matter the size of your debts, the first thing is to determine to stop adding on more debts. This might sound like a no-brainer but I tell you that it is kinda impossible sounding for some people. Yes! There are people who do not really think that they can survive on just their income no matter how little or great. Sounds kind of confusing right? But that is a complete truth. It is all in the mind! Do you know that there are those who earn well but do not think so? Yes there are! For such people they don't just wake up and decide to get out of debts. It doesn't work that way for them. Many of such try over and over to get on the bus for a debt freedom ride but most often get off the bus at the wrong bus stop; you know, before their actual bus stop and return back to base. For such persons, something has to happen, something has to give within them before they can really succeed at their attempt.
It would be a good idea to think of something that is so important to you and that depends a lot on your succeeding at your debt freedom journey for it to succeed. It should be something that matters to you so much that you need to achieve so that you want to make "a sacrifice" by paying off your debts and staying away from debts to achieve it. Examples could be say planning ahead for your wedding, making sure to have enough to purchase land property or just taking a vacation. There needs to be a motivation for such persons. Here I am talking real motivation otherwise it would not work.
Another thing would be for such persons to do everything possible to avoid the very cause of their problems such as spending time browsing through online stores, going by boutiques that display hard to ignore wares. It would also be a good idea to not go about with a lot of cash and to leave behind at home, your ATM card if you have a problem with impulse buying. You need to ponder on all the things that you find hard to resist and cut them off if you really mean business.
Like many of you may have guessed by now, I am a recovering spender and it took me automating my savings as a major check on myself. I had money in the bank but did not have money to spend. This caused me to live like I had actually spent all my money and managing with what ever little was left.
It was tough going initially because the first automation I did was for almost a year so you can imagine that I had to do something to live within my present means. It was initially not very easy to do but I am glad that I did because it taught me the true meaning of frugality. I discovered that in a situation of seeming lack, the human mind goes to work to seek for a solution out of the present situation.
As humans, if we allow ourselves, we can actually make the most of any situation that we put our minds to. Actually, I think I took mine a little way overboard because I got to the point that I could make really tasty meals without including beef or chicken or any of those enticing proteins. In my own way, I was living the rice and beans, beans and rice stage of Dave Ramsey. I focused more on a lot of crayfish, smoked fish and so on and still had a lovely meal. With time, as I began to get the hang of it, I made better meal plans and preps that included said proteins of beef, chicken etc.
I made a lot of discovery in this process. I discovered that when you draw out a meal plan for say a whole week, you are more likely to spend less. Oh yes. I have known of meal planning for ever but have never until I began this frugal journey succeeded at it. I actually tried at one time or the other in the past but never followed through with it.
One pro of meal planning and prepping is that you know what a particular week requires food wise, and so you go grocery shopping with purpose. You make a list of what you need to make all the meals for that week and shop for just those. There are some items that you may need to purchase that would serve for other meals for the week as well and so it ends up making your expense for that week cheaper. I have a meal planning post I am putting together to bring out soon. Do you know that without a meal plan you are likely to spend more than you actually need to? Give meal planning a try and then you would understand what I mean.
There are a whole lot of free templates out there to print and use. It does not have to be in the same way. You can do a simple pen and paper timetable yourself too and you would still achieve the same result.
Below are some samples scouted for from the web. I shall soon make my own design available for download to use for free.
Meal Planner
Grocery Shopping List
That being said, as you are on a debt free journey, you need to decide that you are going to learn to say "NO" to yourself and to people. I also have a whole post to talk about this coming up soon.You should refuse to let your debts grow any bigger. Stop adding to your present debts. QUARANTINE YOUR DEBTS! You know, in quarantine mode, anything that is unwanted is closely monitored and checked to prevent it from growing any bigger so that it does not birth even bigger problems in the future. Treat your debts like they were in a quarantine, in fact create your own idea of a quarantine on paper and start from there. A stitch in time really does save nine too.
Another thing I put myself on is what is called the no-spend month or spending freeze depending on which term suits you better. You also get to determine for how long this will be for. Say a month, two months or more. I know of a you-tuber who claimed to have gone at it for 52 weeks, the whole of one year! Woah!
No spend months are usually intended that you will only spend money on the usual bills such as rent, water and electricity bills and then your groceries, transportation or car fuel etc. Any expense that can be done away with such as shopping for a a new kitchen utensil, buying a new film, eating out, are not to be spent on at all! These are normally not even part of your regular cash envelopes for those who have adopted the cash envelope system. In this no spend month, you could even decide to not have your blow money too. The only expenses in this category would be basics such as toiletry which of course can not be ignored.
For someone like me who usually shops in bulk, I could afford not to spend on toiletry during the no spend months because I purchase even more than a tube of toothpaste when I go personal shopping besides toilet tissues, deodorants and so on. This way even outside the no-spend months, I can have some spare money from personal shopping category. Do not forget that you categorize as you see fit. For more on the envelope system, check out my post.
Now after you have put all of these in place, you need to sit down and draw out a debts hit-list. That's right, you read right. See your debt freedom journey as a mission of mass destruction. Mass destruction of the debts that have kept you in chains all these while. You should know that the hands of a debtor are tied and what he/she can do is way too limited if at all. The debtor/borrower is always slave to the creditor/lender. You can read more of that in my post "Debts * Another Face Of Slavery". Make a hit-list of every single money you owe, be it in loans, credit purchases whatever. Make sure you have it all down including how much sum total you are expected to pay on each debt. This means that for loans, you need to include any accrued interests to be paid on it as well.
It is a good idea to have a visual of all these debts that you can put up somewhere like in your bedroon on the wall etc so that each day you look at it on your wall, you know you’ve got a job to do in getting out of debts. One suggestion from Dave Ramsey is to draw a debt freedom thermometer and hang up on your wall or place on your refrigerator; just somewhere that you can see it every single day and every single time you are at home, to remind you of what your mission or goal is about. This is a huge drawing of a normal thermometer. The difference would be that the caliberated readings would not be figures in Farenheit or Celcius as normally you would see on a thermometer, but figures reading in say Naira or Dollars etc depending on the currency you use in your location.
With every debt you pay off, you mark it on the thermometer starting at the bottom of the thermometer and going upwards. Some people even colour theirs with different colours for each successful payments. The topmost figure would be the last payment for you to make to become a hundred percent free of all the debts.
These templates were got from the web. I have also included my own design here to download to use for free.
Now in drawing out your debts list, you need to factor in time frames for paying off each debt. That means setting a goal of when you expect to be free of it all. That way you have an expectation of what month or year you should be completely free and as you mark off each payment, you can visualize your progress and this is a huge motivator; seeing progress. Some persons use anniversary dates or such like. For example, a 28 years old person could say "I should be debt free before I clock 30 years" or a person who is already say 9 years in marriage could say "I should be debt free before my 12th wedding anniversary" or even a newly pregnant mother could say "I should be debt free before my baby is born" etc. Note that the duration should be dependent on the size of the debts. Huge debts might take longer than smaller debts even though you should have it at the back of your mind that the set date should be the earliest date possible as you aggressively tackle the debts.
To make the journey easy for you to start, you can begin by paying off the smallest debts first no matter how little. The reason is that it is easier to pay off small amounts and so it is quicker for you to record your progress on your wall chart. This gives you a sense of actually making some effort and so you stay motivated.
It is left to you to decide which method you would adopt. I personally chose to start with the bigger amounts because even though I might need to pay on them more than once before they are completely paid off, it also made my journey to debt freedom faster because the smaller ones would eventually be a walk over. You do not of course need to take huge bites like I prefer. You do you, so long as you are actually doing something.
At the end of your debt freedom journey, you can decide to give yourself a reward. It is a good idea to place a reward that you would give yourself for getting out of debt. I have listened to some people who said that for each milestone reached, that is for each debt payment completed, they give themselves a small reward. Let me be quick to sound a warning to be cautious on the reward thing because I have also listened to families who moaned that whenever they decided to give themselves a reward, they went over board and so were plunged back into some more debts. Arghh! 
There was this Dave Ramsey show I watched recently where a woman who had come to do her debt free scream was reminding Dave of how he had referred to scripture where God was comparing getting out of debts as running for your life. Dave also pointed out that where ever loans and debts are mentioned in the Bible, they are not associated with anything good. This should make us understand that if God Himself does not encourage debts, why then do we think it is okay to go into debts? Think upon it!
There was this Dave Ramsey show I watched recently where a woman who had come to do her debt free scream was reminding Dave of how he had referred to scripture where God was comparing getting out of debts as running for your life. Dave also pointed out that where ever loans and debts are mentioned in the Bible, they are not associated with anything good. This should make us understand that if God Himself does not encourage debts, why then do we think it is okay to go into debts? Think upon it!
The bottom line is to agree with yourself to not spend any more money for something that you can not pay cash for. If you cannot pay cash for it, you cannot afford it! That is the mindset that will keep you out of debts.
With debts you owe and with savings you own - Dave Ramsey.
With debts you owe and with savings you own - Dave Ramsey.
What are your thoughts about the best way to deal with debts? Leave your comments.