If you weren’t able to read Part 1, it’s a must! Check it out here.
As stated in Part 1, the steps here are not optional; they are a NEED for getting out of debt. I hope you did your necessary homework (again, check out Part 1 to know if you are up to speed!). This is an abbreviated version from Dave Ramsey’s Total Money Makeover which is simply awesome (must read for all who are in debt and want to get out!)!
So without further ado, here are the rest of the steps to eliminate debt using the Snowball Effect:
5. Once the smallest debt is paid off, take everything you were using to pay off the first debt and start attacking the next smallest debt, continuing to pay the minimum on the other debts.
6. Refuse to get into any more debt (this is why you should build up your $1,000 in emergency funds before you start on attacking your debt…because things will come up!). If you don’t have it, don’t spend it!
7. Sacrifice. If it means eating a lot of beans and rice for dinner, so be it. If your friends think you’re crazy, you’re probably on the right track. If getting out of debt were easy, fewer people would have debt, and more people would have savings! Did you know that according to a 2016 GOBankingRates survey, 69% of Americans have less than $1,000 in their savings accounts? It takes some discipline, but you can absolutely beat the norm! Sell anything and everything you can do without. (In Dave Ramsey’s words, your kids should be worried that they are next! Now that is serious!)
8. Stay focused. Imagine yourself in a life without car payments, without student loan debt, without medical bills, without credit card debts, and without debt collectors calling. It will not be easy. Maybe you wandered your way into debt; you certainly can’t wander out of it. Get gazelle-intense and don’t let up until that last debt is paid off!
Here’s the thing – if you will take the necessary steps to make it to this point, you will absolutely not regret it! Life becomes so much more enjoyable when you are debt free. Take heart; it’s possible to live debt free, and if you stay focused and intense, it’s in the bag!
I’d love to hear some of your debt- elimination success stories; feel free to share in the comments!