You Must Get Your Personal Debt Under Control If You Want to Quickly Achieve Financial Freedom. This Can Be Done Much Faster Once You Eliminate All of Your Highest Interest Rate Consumer Debts First.
This month I want to start with examples of how you can eliminate your personal debts much, much faster without sacrifice or having to bring in one more penny every month. I am going to explain to you how to pay off your consumer debts much faster which will save you thousands of dollars of interest you will never have to pay. Here is an example of what I am talking about.
Let’s say the payment of your highest interest rate debt is $212.83 minimum payment. If you will add the $93.00 (a good number for a family of four at a nice restaurant) you saved by not dining out each month with your family will total $305.83 ($212.83 + $93.00 = $305.83). If you pay that amount each month for this debt until it is paid in full, it will greatly shorten the payback time of that debt saving you hundreds or even thousands of dollars of interest.
Once that debt is completely paid off you can then apply that same amount of $305.83 to the second highest interest rate debt you have which has a monthly payment of $183.47. If you were to add the $305.83 you no longer have to pay for the highest interest rate loan to the payment of the second highest interest rate loan, this would allow you to make a payment of ($183.47 + $305.83 = $489.30). If you were to pay $489.30 every month until the second highest interest rate debt is completely paid off it shouldn’t take too many months to eliminate that debt.
Next your third highest interest rate debt has a monthly payment of $451.00 for your car. If you will add the $489.30 from the second highest interest rate debt to the $451.00 monthly payment for your car, this would allow you to make a payment every month of $940.30 ($489.30 + $451.00 = $940.30). If you were to pay this amount every month until your car is completely paid for, it should only take a few more months.
Let’s say your next highest interest rate debt is $378.00 for your second car. If you will apply the $940.30 from all of the previous debts you have paid off to the monthly payment of your second car, it would total $1,318.30 ($940.30 + $378.00 = $1,318.30). If you would pay this amount until your second car is completely paid for it won’t take long to pay off the second car.
Next if you will again add the $1,318.30 you were paying every month for all of the previous debts to the next highest interest rate debt you have for your furniture payment of $179.00 every month, this would total $1,497.30 ($1,318.30 + $179.00 = $1,497.30). If you paid this amount every month until your furniture is completely paid off, it should only take one or two months.
At this point the only debt you have remaining is the payment for your home which has a monthly payment of $1,150.00. If you will add the $1,497.30 used to pay off all of your other debts and add that amount to your monthly house payment of $1,150.00, it would total ($1,497.30 + $1,150.00 + $2,647.30) every month until your home is completely paid off.
There is “Good Debt” and there is “Bad Debt”. The idea I am trying to get you to understand is “Bad Debt” needs to be paid off as quickly as possible. The faster you eliminate all of your bad debts, the more money you will have to either re-invest in more real estate or give you the lifestyle you have always dreamed of. This will only work if you have the personal discipline to stick to the plan I have set before you. I believe this simple strategy can get you to financial freedom in a short period of time.
If you will follow this simple plan every month you could quickly find yourself out of debt much, much faster by only sacrificing one dinner out with the family each month.
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Until next month, happy investing!