Monday, January 31, 2011

Be Debt Free

So many people I know of are deep in debt to the point of pain and loosing everything they own. No so long ago we had a time of easy credit, way too easy. People were being told on TV that it was a good idea to take out an equity loan to pay off high interest credit cards. Offers arrived in the mail almost daily for new pre-approved credit cards and my credit card bills came with “check” that were good for paying of my other credit cards. We could purchase a big house with nothing down.

Well we know what happened with all that easy credit. How do people get past the debt? Personal Financial Discipline is the key. No one “forced” people to  accept all that easy credit but it was enticing.  There are some basic steps to financial peace of mind.

1.     Start paying off all your debt starting with the smallest. When that is paid off take that payment and add it to your payment of the next smallest debt until all unsecured debts are paid off.
2.     On your mortgage pay a little extra each month to reduce your principal faster. Pay off your home early.
3.     Set up an “Emergency Savings Account” adding as much as you can each month
4.     Invest in a retirement fund and add to it.

By taking baby steps in the beginning you can become debt free by building up your personal financial discipline one month at a time.

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