Saturday, December 22, 2012

Steps to Become Self-Reliant

As expected, we are all still here. So what lesson should we take from this? Understand that prophecies are nothing to be concerned with. We will not receive a warning that the end is here. So that means we should be prepared for any disaster. Key to being prepared is to become more self-reliant. Self-reliance is so important because as you rely less on others, there will be less disruptions you will need to plan for.

The very first step in becoming self-reliant is getting out debt. The more debt you have, the more you rely on your job for the money to pay all of your monthly bills, which is a recipe for high stress. Take a look at the combined monthly interest you are paying on all of your debt. Do you feel like puking now? Imagine being able to apply that money every month elsewhere, like a weekend retreat in the woods. You dug yourself into this hole, so start climbing out.

Some people choose the higher interest rate bill to pay off first. Some people choose the highest monthly payment to pay off first. I chose the bill I can pay off the fastest. This may not be the most profitable, but it helps me feel like I am accomplishing something. When that bill is paid off, you apply that money to the next bill until everything is paid off. Create a plan and stick to it. Sure it may take three years, but imagine how great it will feel three years from now!

Take a look at each monthly bill you pay and see which ones are unnecessary. Do you really need cable right now? Maybe sign up for Netflix instead? Can you sign up for a cheaper cell phone plan? Stop eating out, stop ordering a morning latte, stop trying to keep up with your friends and neighbors. By simplifying your life, you are saving yourself money. Any extra money you can find in the monthly budget can be applied to paying off debt. Also, look around your house at all of things you have purchased with this debt. Can you sell anything on Ebay?

Ask anyone who is debt-free and they will tell you it is amazing. Work becomes more enjoyable because you get to keep the money each payday instead of divvying it up amongst the bills.

Getting out of debt is the first of many steps to becoming self-reliant. I will post new steps over the next week that are realistic and affordable.

Stay always prepared!

1 comment:

  1. Amen. It takes time, but no one gets into debt overnight either. Paying off the first bill is an enormously wonderful feeling so I agree with your strategy - it's motivating and helps you to continue to cut your debt. Using those same credit cards to continue to pay off the next one is even better when you pit them against each other and use their 0% interest balance transfer offers over 18 or 24 months. Now you're cutting down on the interest you're paying and every payment goes toward your debt in FULL.