Are you drowning in debt?
Are you ready to commit to paying off your debt?
Paying off debt can be a real life changer.
Not like finding a mystical mermaid with underwater caverns filled with coins and jewels kind of life-changing…but close!
It’s still gonna take some hard work to pay it off but it will be worth it.
Getting out of debt is not just about paying off a few credit cards and calling it a day. It involves changing your financial habits and making smart spending decisions.
I spoke about this topic on my Savings Segment on Fox.
Watch the replay video here:
Paying off your debt is possible, and you can become debt free with a little bit of work.
It’s not gonna be as fun as cashing in your real mermaid’s fortune filled cavern…but it will be just as rewarding.
It’s natural to experience a few hiccups along the way, and I’ve made my fair share on my debt free journey as well.
Because you see, wasting your time trying to find a real mermaid won’t get you out of debt and these common mistakes won’t either!
Here are a few common mistakes people make when they are drowning in debt.
Mistake 1: They Don’t Change Their Spending Habits
Have you ever noticed that we are creatures of habit?
When it comes to spending money, this is no exception. We tend to eat at the same restaurants and frequent the same stores. Just like cats will follow their routines to stay comfortable, we do the same thing!
Some habits can be a good thing such as cooking at home or saving up for large purchases. But some of these spending habits can be more than you can handle financially.
If you are unwilling to change your spending habits, you will be in debt for life! It was your spending habits that put you in this situation, and you will need to change them to stop drowning in debt.
Mistake 2: They Do It Alone
When it comes to talking about debt, many families struggle because they don’t ask for help.
If you don’t feel comfortable talking with your friends or family, there are some resources out there you can talk to.
You can speak with a nonprofit credit counseling agency to get free help from financial experts. They are a free resource you can use to get help when paying off or managing your debt situation.
While these are great resources, don’t underestimate the power of telling your friends and family. They may not understand precisely why you are deciding to pay off your debt, but they can be an excellent place for support and encouragement during tough times. And they can help you feel like your head is above the water while you financially feel like you are still drowning in debt.
Mistake 3: Not Making A Budget
It would surprise you how many people who are drowning in debt still do not have a budget! Whether they think it is too much work or a waste of time, a big mistake people make when trying to pay off their debt is not making a budget.
If you are paying off debt, you can’t afford not to have one!
Start by creating a budget and decide how much money you need to make each month, what to spend it on, and how much to put away toward your debt.
Having this plan can help you figure out what areas you will need to cut back or eliminate entirely from your spending.
I’ve got a set of free budgeting sheets that will help you get started!
Mistake 4: Not Having An Emergency Fund
About 50% of Americans do not have enough cash on hand to cover an expense of $500 or more!
I’l be honest, I didn’t have that either when we first started paying off our debt. We were just struggling to make ends meet! We were just drowning in debt.
If you are paying off your debt, you need to have an emergency fund first. The reason for this is because if an emergency were to happen, you need to have money put away to cover this expense.
Do whatever you can to get $500 in savings as soon as possible! I’ve helped over a thousand people add $500 to their savings account in only one short month! Join us here.
The important part about having an emergency fund is that you don’t usually know when an emergency expense will pop up and having $500 – $1,000 set aside will help you to be prepared.
If you don’t have this money put away, you could put yourself into more debt anytime an emergency comes up (and trust me, they WILL pop up!).
You can’t predict when your car will break down without notice, or when the washing machine stops working and overspills all over the floor. The truth is that these things never happen when it’s convenient.
It’s best to put away about 3-6 months worth of expenses for emergencies, but if you are trying to pay off debt, you should have a minimum of $500 ($1,000 is even better) in an emergency fund.
Making some of these mistakes can not only land you in even more debt than when you started, but you could also end up taking longer to pay off your debt.
Spoiler Alert: There are no real mermaids with fortune filled underwater caverns! That only happens in Disney movies!
Unfortunately, it’s gonna take some hard work to pay it off including changing your habits. Use these mistakes as lessons on your debt free journey, and don’t make the same mistakes when paying off your debt. Your financial future depends on it!
YOUR TURN: Which of these mistakes did you learn from? What would you have done differently while drowning in debt? Comment below!
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