What Are The Key Strategies For Debt-Free Living?

You, like many other people, are in debt, right? Of course, you are. After all; We all live with debt in some way. Maybe not such huge debts; But we all have small debts, without exception! Thanks to credit cards, which are the heroes of our wallets, they have accustomed most of us to living in debt. So, being in debt no longer seems strange to anyone.

Living this life has become normal. You see, even if we do not have money, we can easily shop and buy almost anything we want by borrowing from our future earnings.

It’s usually not necessary to say that living a debt-free living is a big dream if you have debt. But while you’re in debt and struggling to pay it off, it seems so far away and sometimes impossible. That said, I don’t want to steal your last motivation. Instead, I want to encourage you not to give up and keep going. Because a debt-free life gives you the chance for true financial freedom.

With a good strategy and the right mindset, you are capable of living a debt-free life, no matter where you start.  So let’s dive in. Let’s take a look at the benefits of living debt-free and how you can achieve it, perhaps faster than you now think.

How Can You Create A Debt Repayment Plan To Achieve Financial Freedom?

debt-free live

Another thing you need to do to get rid of your debts as soon as possible is of course to earn more money! After all; The more money you get into your wallet, the faster you pay off your debts and the sooner you reach financial well-being. 

So, what will you do about this? You already work 8-10 hours a day. When you come home in the evening, you barely sit on the sofa and you barely get rid of the fatigue that has settled on you until the next day. Should you also go out in the evening and sell lemons? Or should you take a taxi?

No no! After all; We live in an age where technology has come of age and additional job opportunities are much easier than the cliché methods of the time!

You might say, yes, of course, there are many benefits to living a debt-free life. But what exactly are they and what does a debt-free life mean for your finances?  All your money is yours. I know how hard it is to know that most of your monthly income will be gone faster than it came in because it is no longer yours.

While you have to bank every extra penny you earn when you’re in debt, when you’re debt-free you’re free to decide what you do with your money. This is a great first step towards financial freedom when you no longer have any obligations such as debt. You can start taking responsibility for your money yourself.

Another point I would like to mention here is that every penny you earn when you are debt-free goes towards your net worth, which starts to rise into positive territory. So it’s up to you to consciously decide what you can do with your money. It gives you back control.

What Are the Differences Between Good Debt and Bad Debt?

These are all big expenses that can improve, rather than harm, your financial future. This may mean that “good debt” may be a smart choice in some cases. For example, you can save on rent by buying a home. 

There is “positive debt.” When people talk about “getting out of debt,” they are most often talking about “bad debt.” That means credit card debt, expensive car loans, personal loans, etc.

A good degree can also help you earn a higher salary. Starting a business can put your income potential in your own hands. It’s certainly worth considering exceptions to a debt-free life. Remember that “good debt” comes with a strategy to pay off the debt.

Although I’m not a big fan of the distinction between bad and good debt, I still want to mention it here. There is debt that you can use to your advantage.

Some top examples of good debt include:

  • house/real estate
  • Education loan for a good career
  • A business loan for your company

How Does Debt Consolidation Impact Your Journey To Debt-Free Living?

How you spend your money depends mostly on what you think and how you feel. If you’ve had a “spend now, worry about it later” mentality in the past, you’ll need to think completely differently to live a debt-free life.

Instead, you have to decide consciously and in advance about the things you are going to buy. In short – you spend money with your financial priorities in mind. What do you have to spend money on?

Your necessities for daily life: What can you spend money on? Your focus on your priorities, such as B. paying off debts quickly, and saving for an emergency fund.

What do you want to spend money on? Your wishes: You learn to keep these expenses in a healthy balance. Another side benefit is that you’ll feel much better when you start making conscious decisions about your spending, rather than feeling guilty afterward if you make decisions  based on how you feel in the moment.

Can You Share Stories Of Individuals Who Successfully Eliminated Debt?

financial freedom

It is known that countless people and businessmen have reaped the benefits of living a debt-free life. Dave Ramsey, a finance expert, can be given as an example of success by eliminating all his debts and completely cutting off his relationship with financial payments.

What Strategies Help Avoid Relapsing Into Debt After Becoming Debt-Free?

If you’re currently paying off debts or are newly debt-free, you’ve learned to live without that money. This is a great opportunity. Why? While you’re used to not having that money in your pocket right now, and you’ve learned to budget without it, you can use that very money to put into your investments.

If you pretend you still have debt, you can save the money for an emergency fund and/or your retirement account.

  • Investing your money – it’s that easy to get started
  • Creating an ETF savings plan as a beginner

It may sound strange to say that living debt-free could have its downsides, but it’s important to have a complete picture of what you’re getting yourself into! There are a few things to consider here.

See you in the next post,