From Debt to Dominance: Reclaim Your Financial Power

If you feel like you’ve been drowning in debt, with nowhere to go, that can be overwhelming. However, just because you’re in debt today doesn’t mean that you will always be in debt. But it won’t go away overnight. You can reclaim your financial power—but first, it’s important to take these steps below: 

Know your number

It’s not going to be all that easy to take any steps towards financial power without knowing the kind of debt that you’re dealing with. Many people who have debt stacking up will choose to ignore it because they don’t want to face how much they have to pay off.

But the first step, obviously, is going to be taking stock of the amount that you owe, so that you can more easily move on to the next steps of taking care of it and moving onto financial wellbeing. Much like your credit score, you have to understand where your debt is to do anything about it. 

Make a budget/plan

Once you know how much you owe and are confident that you want to take care of it, it’s time to make a budget or plan. Some people will try to go all gung-ho on their debt in one shot and while it’s tempting to get it out of the way, if you’re not careful, that could put you even deeper into the hole. Instead, consider making a budget that allows you to pay a solid amount every month towards your debt without it being too much set aside that you have a hard time even getting by every month. 

Say goodbye to high-interest

If you have a lot of high-interest debt, you want to take care of that first. The thing about high interest debt is that it can keep you running around in circles with it without you ever making a dent in it. Once you get the highest interest debt out of the way, then you can start paying off the debt that isn’t racking up extra dollars as every day passes. You may need to take time looking through your debt and agreements to find which ones are high-interest, but it’s worth it. 

Start saving

While you’re trying to pay off your debt, don’t be afraid to start saving as well. Your savings can help you avoid more debt in the future. Open a high-yield savings account if you want to see your money grow as you save. Your first savings account should be dedicated to an emergency fund. An emergency fund can make it easier for you to take care of yourself should something unexpected arise so that you don’t have to get in even more debt to get out of the situation. 

While you may think that you should save to pay off, it actually works better just to work on those monthly debt payments. It can be too tempting to use your savings for something else. So when you get your paycheck, just pay off that debt while setting aside a bit for savings, as well. 

Live within your means

One reason why people are in debt is that they’re trying to live outside of their means. Instead of trying to keep up appearances, learn to be happy with simplicity. There will be a time in the no-debt future where you can spoil yourself but for now, keep your head down and work on knocking out that debt. You’ll be glad that you did when you see that debt get reduced to zeros in no time.

In Conclusion

Take care of your future by taking care of your debt today. You’ll be glad that you did when you start living your life without debt. Nothing has ever felt as great as a debt-free life.