“I like my players to be married and in debt. That’s the way you motivate them.” –Ernie Banks.
There’s just one thing that will always hold you back from “following your passions,” or doing shit that you want to do when it comes to your income and your life. What is this that can hold us all back?
Being stuck in redit card debt.
When you’re in credit card debt you’re totally limited as to what you can do with your life and your time. You have to spend today’s income on yesterday’s fun. The crap that’s either collecting you dust or that bottle of booze from the club that’s a distant memory is now coming back to chip away at the money you work for.
If you want to start your own side business it’s going to be tough with credit card debt because:
- Most of your extra cash goes towards debt payments.
- Your free time is spent on a part-time gig you have to pay off debt.
- You don’t have the energy to do any more work.
- You get stuck in a rut because you’re always working and you don’t see any real results.
What can you do about this? How can you crush your credit card debt to so that you live more passionate life with more choices?
Create a plan for paying down your debt.
What are you going to do about your debt? Is this the time in your life where you finally buckle down and working on paying down your debt? If you’re ready both emotionally and logically to start working on your debt, then you’re going to need to start off with a plan.
What does a plan consist of?
- How much money you plan on putting towards your debt.
- What your deadline is.
- What you’re going to do with your credit cards while you work on paying down debt.
- Determining how you’ll make extra money. Will you sell crap, start a side gig, work more hours at your current job, or find a part-time job?
If you don’t want to worry about a plan then you can just start hustling right now and putting all of your money towards your debt. Don’t hold back.
Find a strategy that works.
There are two popular philosophies for paying down debt. Let’s look at both approaches to see which one is the most appealing to you.
The Debt Snowball (more emotional option):
This is where you make the minimum payment on all balances. Then you work on paying down the debt with the lowest plan. The goal of this plan is to build momentum with a quick win. This quick win will show you that it’s possible to start paying off your debt. This is the emotional approach to killing debt since you’re relying on your emotions to push you through.
The High-Interest-First approach (logical option):
You make the minimum payment on all balances once again. Then you put all of your extra money towards the debt with the highest interest rate. This should work because you’re saving money by attacking the highest interest rate first. The only setback is that it might take you longer to see any real results.
Which strategy will work for you? Only YOU can answer that question.
Hustle for a long ass time.
You need to do something. No more being delusional and chasing “passive income.” No more being delusional and waiting for the next great idea or trying to start the next Facebook. You need to get off your ass and work. You might have to work longer hours. You might have to work on the weekends. You’re going to have to suck it up and just work. No excuses. You need to hustle for a long ass time if you want to see any real results.
Take a break.
When you see results and are debt-free (or as close as it gets) you can then treat yourself to a little break. You need some time off to recharge your batteries. This break can be a few days or a week depending on how you’re feeling. For me personally there’s nothing like a week down south hanging out with close friends. I always come back ready to work.
Get to work on your side business.
You need to be ready to get off your ass. It’s not going to be easy. It’ll be pretty damn fun though. Now that you’re no longer being held back by debt you can start to work on your side gig!
Are you ready to become debt-free? Are you ready for a life of abundance?
I see you didn’t mention the popular 0% balance transfer promo that comes with a lot of credit cards. I think I saw one for 18 months of no interest the other day (BofA Amex, I believe). Depending on the amount, 18 months should provide quite a savings, assuming whoever uses this actually pays down the debt at the same rate as they would if it was accruing interest.
I’ve mentioned balance transfers in the past. While I do believe in the idea I feel that the process can be really easy to screw for those that are starting out with their journey to become debt free.
Once you get a little more advanced and start using debt as leverage for other investments, you can really score big with balance transfers.
Thanks for bringing this up David.
Do you have any friends that have tried a balance transfer?
True, balance transfers are not for those who are just starting to pay down debt, more credit can be tempting. I do have a few family friends who have leveraged debt using a balance transfer in the past, some for its intended purpose, and some to make risk-free profit (I have a friends who maxed a $10k credit card with no-interest on purchases for 12 months, she invested the $10k in a CD, netted around 5% profit a few years ago). Alternately, a friend of a friend apparently took out a second mortgage for $100k in 2003 (when rates very super low) and invested the money, he paid off the loan in 6 years from just his returns, without personal contribution. I’ve always been skeptical because I thought a mortgage had to have real estate backing it in case of foreclosure.