Getting yourself out of debt works around the same principles as pursuing your ideal weight. People who succeeded in achieving their intended weight – especially if it involves losing it, can probably adapt to the principles involved in going after a debt free life.
Why don’t we compare both endeavours to help motivate yourself? If you can succeed at losing weight, then you can use the same determination and discipline to get out of your debt problems.
Like losing weight, making the decision to do something about your debt is step one. The journey that you are about to embark on is filled with temptations, discouragements and a lot of pitfalls. Your determination will provide you with the discipline to finish what you will start. Sometimes you have no choice on the matter. With losing weight, it can be a looming health problem. With your debt problems, it can be the threat of a lawsuit or losing your home. Use these factors to help motivate yourself to succeed.
Before you can select a particular debt diet program, assess the situation first. Just as you set the weight that you want you achieve and therefore lose in the process, you also have to figure out the amount of debt that you have to pay off. List down the debts that you owe, the creditors, interest rates and other fees that you have accumulated because of those debts. When you have that, get your total income, subtract the expenses that you need for basic necessities and see if the remaining amount is enough to cover your minimum payments.
What you are doing here is identifying your financial capabilities. While on an actual diet, you select the diet plan that your body can adapt into. If your work is physical, you can’t handle diet that will require you to eat less meals. The same is true with your debt diet. You need to know your financial capabilities to know the debt relief plan that you can afford.
Once you know your capabilities, it will be easier to select the debt relief plan that you can afford. There is no sense in choosing a plan that you cannot afford to pay because that will be doomed to fail from the very beginning. You want to choose a solution that you know you are financially able to see through until the completion of your debt payments.
As you go through the debt diet that you selected, you need to adjust your budget as you go along. Going back to our comparison, most diets come in phases to complement the changes happening to your body. Even the exercise routine will change as you lose the fat and build up the muscles. In the same way, as you close off debts, you need to adjust your budget towards your still existing debts to pay for them faster.
Think of it this way, just as dieting curbs your eating habits, a debt diet will put you on a restricted spending habit too. When you are trying to lose weight, you don’t increase your food intake as you lose the pounds. A debt diet goes through the same principle. Just because you completed payments in one debt, it doesn’t mean you can splurge that money. You put it to good use. You either place it in your emergency fund or add it to your debt payments.
If you compare your debt diet with the actual losing weight diet, it will help you see the bigger picture and tackle two things: your debt payments and the development of habits that you need to make sure you do not get in the same situation again.
Most importantly, both diets we talked will need a lasting effort to maintain the results that you got. A person who just reached their ideal weight cannot eat just about anything because they risk taking in all those pounds they just shed. When you finished paying off your debts, you need to consider the fact that deviating from your budget and spending plan could result in an accumulation of debt once more. Discipline yourself and remember the hardships you encountered while getting rid of all your credit woes.