My wife and I have been debt free for more than three years.Â Here’s how we turned our lives around and changed our family’s financial future.
We began to spend less than we earned.
Brilliant, no?Â It sounds so simple, but the reality is, many Americans spend more each month than they earn.
We put our credit cards in our wallets – and just left them there.
We stopped using our credit cards.Â We didn’t cut them up or freeze them in a bowl of water – we simply made a decision to stop using them.Â This might have been the single most important thing we have ever done.
We began to live on a budget.
Following a zero-based budget, we were able to control our spending and maximize our savings.
We began to dream of a debt-free future.
Within the first week of our financial turn-around, we were already convinced that, one day, we would be debt free.Â This confidence, though tested by circumstances, never changed.
We created a system for organizing our financial documents.
Organization is so important.Â In the past, we might forget to pay a bill or we might lose an important document.Â Now, we have a system for organizing our documents, scheduling payments, and balancing our accounts.
We worked together.
I am the nerd and I like spreadsheets and calculations.Â My wife is practical and she specializes in household management.Â We combined our strengths, encouraged one another, and refused to argue, ever again, about money.
We created a specific goal.
Our first goal?Â We wanted to be debt-free.Â Having this specific goal, something to aim for, really motivated us.Â We gave ourselves a specific goal, and a specific date to achieve it.Â Surprisingly, even though we missed our original goal date, instead of being discouraged, we were further motivated.Â The goal itself, the dream of being debt free, really kept us going.
We began to think long-term.
This was key.Â Instead of living month-to-month, we decided that we wanted to live decade-to-decade.Â Making the decision to be forward-thinking, we were able to give up temporary wants, and focus on long-term plans.Â We matured, you might say.
We read, and continue to read, all that we can about personal finance.Â Inspired by the success of others, we press forward.Â We are not where we want to be, but we are confident that we are headed in the right direction.Â Even surrounded by the negative news of the day, we have great hope for our future.