My Tips for Starting Your Debt-Free Journey
I love this time of year (she writes while staring out the window at a stormy, grey landscape). The turn of the new year is a time for new beginnings, new possibilities and a clean slate. Usually, after the Christmas blowout, everyone is super motivated to live their best life come January, but when it actually rolls around, it’s so much more difficult to implement your goals into your lifestyle. I am just over five months into my debt free journey and it’s taught me a lot about goals. So if you are thinking of paying off your debt, here are my tips for giving yourself the best start.
- Use the SMART system. Are your goals Specific, Measurable, Achievable, Realistic and Time Constrained? Or are you giving yourself broad statements like ‘Pay off debt?‘ If so, how are you going to achieve this? With something along the lines of, ‘By the time I’m 35, I want to have decreased my debt by £20k’ (bearing in mind that this is realistic given your income etc.). By using the SMART system, you must define the goal, how you will achieve it and by when, which helps to form the beginning of your plan.
- Ah, the plan! I love a good plan. When we started our debt free journey, I didn’t know about Dave Ramsey (we are based in Northern Ireland), or any of the other resources out there. I started with a spreadsheet, listing our debts, our income and our monthly bills and decided how much extra we could afford to throw at our debts each month (link here for how to draw up your budget). This gave me an idea of how long it would take to pay off our debt. As time went on, I found ways to cut down our bills and make extra income, which has shortened our debt-free date, but that initial plan is key.
- Keep motivated. I must admit that sometimes its tough to stick to the plan no matter how meticulously I’ve thought it through. So do what you need to do to keep motivated. Have a plan to celebrate when you are out of debt. Tell someone to hold you accountable. Join up with others on the same journey as you, for example, the Instagram debt-free community. Getting into that motivated mindframe takes time to build, too. Allow yourself to build it up the way you would train for a marathon, in that you don’t go out on the first day of training and run 26 miles. It takes time to get to the point of being capable of something challenging.
- Shake it off when you fall off the wagon. We all have blips and I must confess, there have been times over the past few months where I’ve dipped into our Emergency Fund for non-emergencies like a pizza or to get the car valeted. I like the analogy knocking about a few years ago about failure; if you dropped your mobile phone on the ground, do you pick it up and hope it’s not smashed or do you stamp on it repeatedly until you ensure that it is? Apply this logic to your finances when you have a momentary lapse. You got this.
Hope this helps someone out there. Give me a shout below if you need any advice, or just to let me know what your goals are.