There is no secret sauce to managing your debt. If you have been following my posts this month, I have focused on debt management and I have written many tips, best practices and strategies I have personally used in my life.
I believe that you’ve got to have the will to make personal sacrifices and to be head strong, or to be “bullish” (as I like to say), about becoming debt free. My wife and I live 26% below our means (for every $1 we earn, we only live with $0.74), because we choose to tackle our finances aggressively. Even though we have the urge to live with more from what we earn, we see the bigger picture and value the long term satisfaction we will receive once we are debt free.
To be more specific, by being able to live with just 74% of what we earn, we can pay off our student loans in 6 years and our mortgage in 13 years (our student loans have higher interest rates and it’s an unsecured account, so we prioritize them first). Normally, just the minimum payments would have taken us 25 and 30 years to pay off the student loans and the mortgage, respectively. That’s hundreds of thousands of dollars we are going to save and contribute to our lives in the future, whether that’s in the form of retirement contributions or more vacations! You see, our frugal life NOW will pay us huge dividends in the long run.
If you find yourself wanting to tackle this debt thing seriously and more aggressively, check out this info graph and read our other posts on savings, budgets, and debt management on our blog!