Eliminating Debt and Achieving Financial Wellness
Before we discuss how to eliminate debt, we need to first of define financial wellness;
What is Financial Wellness?
“Getting out of debt and safeguarding your financial future”
Now obviously that’s a very broad description, but that just about sums it up. Truly the step to securing your financial future is getting out of debt. But the million dollar question is, just how do you get out of debt?
Eliminating Debt and How to Achieve Financial Wellness
Now when it comes to financial education or financial advice, financial advisers will lead you to believe that managing your money is a very complex matter and that you have to have a professional financial adviser to help you along the way. My reply to that is B%&# S@#%… Excuse my language. The key reason why financial consultants tell you that managing and investing your hard earned money is complicated is because they want to sell you one of their financial products or services. The truth of the matter is, managing your money is nothing more than simple, basic common sense.
Here are three basic steps you can utilize to protect your financial future:
- The very first thing you want to do is put together an emergency fund. This needs to be about six months going out. If you lose your job, or lose your business, you need to have six months of cash reserves (no credit card usage allowed) on hand to pay all your bills for six months.
- The second step will be to plan a monthly budget. Very simply add up all your monthly expenses and subtract it from your income and calculate how much money you have remaining at the end of the month. If you have more money coming in than going out, then you have a positive cash flow. At this stage you should be saving and investing the extra money coming in each month. On the other hand if you have more money going out than coming in (negative cash flow), then that probably means you have a lot of debt and therefore you need to lessen your debt. This leads us into our last step, eliminating debt…
- Getting out of debt and becoming free of debt is among the most challenging of all of the steps. What I would recommend you do is (this is what I was able to do to lessen my debt) take your smallest debt (like a department store charge card) and pay that off first. What this can do is enable you to get motivated to tackle your other bigger debts like your car payments and then your mortgage. It is also just like a snowball effect because as soon as you get your smaller debts payed off first it will snowball into getting your other bigger debts repaid. As soon as you start reducing your debt load, your monthly positive cash flow will begin to increase (more money coming in than going out), which in-turn will help you to begin to saving and investing your money.
And now that you have a positive cash flow coming in, you can now start to build your wealth…
How to Build Wealth
The main element to building wealth is self-discipline and investing your money wisely. Many of the top financial experts are now preaching the benefits of living free of debt, and how it’s a key element to building your wealth. We can teach you more about building wealth in today’s current economy. Wealth planning is yet another great way to discover financial wellness.
If you would like to pay off your debts, become debt free and expedite the wealth building process, then fill out the form below with your name and email address to get more details about our financial wellness program.
Return from Eliminating Debt