Anyone who has debt says this all the time. Nobody wants to stay in debt. However, getting out of debt takes more than just words and intentions. It takes action and a plan. In my podcast this week, I go in depth about how to take action and how to develop a plan yourself to get out of debt starting today. In my last blog post, we talked about how planning is something you can do immediately to begin the journey to wealth and financial freedom. So let’s look at how to plan to get out of debt successfully and as quickly as possible.
No one would ever build a house without a blueprint – a visual of every aspect of the house and a plan on how to build it successfully. And that’s what you need to get out of debt – the first step is to develop a blueprint. This is a visual of your finances – your real finances. This first step is actually what keeps most people from ever getting out of debt. They don’t want to walk in their truth, so they stay right where they are. If you are ever going to successfully get out of debt, you are going to need to be honest about your financial situation and be true to what you are willing to do to change it. You need a list of all of your income and all of your expenses – this includes accounts in collections. You need to know exactly what you owe in order to develop the best plan to pay it off.
Once you have your blueprint in place, you need to figure out the best plan for you to pay everything off. I want to caution you about paying for this. Most of the “debt consolidation” programs charge thousands of dollars and basically all they do is get you behind on every bill so they can get you a settlement offer. Doing this will make your credit score even worse than it probably already is. Once your score is damaged, it takes a long time to build it back up and even though you hopefully aren’t going into debt again, your score is your financial reputation and should be kept at a good number. We offer a coaching service and something like that is okay – getting advice from someone who’s been there to support you is one thing, but you don’t want to pay thousands to a company for something you can do yourself.
So now you know what you owe – next, you need to figure out how to pay it off. Using either the debt avalanche or the debt snowball method, you want to arrange your items in the order you want to pay them off. I always recommend the snowball method because of how quickly you can pay off items in full, but pick the method that will work best for you and keep you motivated. Once you start seeing debts being paid, you will continue to be motivated resulting in more sacrifice and more ideas on how to bring in more income. Developing a plan and actually starting the process are the keys to success when it comes to paying off debt.
I hope after today you will stop saying “I plan to get out of debt” and you will start getting out of debt by developing a plan and taking the actions required to finish the plan as quickly as possible. Even without any extra money, if you stop using debt and continue to make all of your debt payments, you will eventually be debt free. But your goal should be to take actions that get you there as quickly as possible so that you can truly begin your journey to wealth and financial freedom.
I am currently sitting in the Atlanta airport waiting to catch a plane home after spending 4 weeks in SC taking care of my parents. As I am sitting here, I am reflecting on how financial freedom played a role in that. You see, most people wouldn’t have been able to leave their home or their job for 4 weeks to do something, even if it was necessary like my situation was. However, many years ago, I had a big aha moment and realized that debt wasn’t taking me where I wanted to go. So I developed a plan to change all of that. And now, I enjoy financial freedom – the ability to not worry about being away from home for 4 weeks. Most people would not be able to leave their jobs – most can’t go 4 days without pay, much less 4 weeks. Financial freedom has given me the ability to own my own business and have no worries about whether or not I could afford to be away. When I got the call and needed to be there to take care of my parents, it was a no brainer – something that financial freedom brought me.
I want that for all of you. I want y’all to be able to not have to worry when life happens. Today, I am going to share 5 things that you can do immediately to begin the journey to financial freedom – there is no need to wait. Let’s talk about them.
- No More Excuses – You need to stop all of your excuses as to why you can’t get out of debt, save money and also stop your “reasons” as to why you “need” something now and it just can’t wait. We all have an excuse bag. I had a huge one. It’s a bag that we carry around every excuse in the book in and are at the ready to pull them out when needed. Stop being a victim. Stop making excuses and start making a plan to pay off your debt, build your savings and reach financial freedom. I did it with $200,000 in debt – you can do it!
- Save Something – We all have an excuse as to why we can’t save money. But without saving money, you will never have any extra. Do you think I reached financial freedom without saving for a rainy day. You need an umbrella – it is going to rain and like most storms, there won’t be any warning. Start somewhere today – automate $10 to come out of every paycheck – today! No matter how much debt you have, do this one thing. And when you build that muscle up, raise it up and soon you will have a rainy day fund that can cover any emergency and like me, you will be able to jump on a plane, no questions asked, and help someone.
- Live Within Your Harvest – This simply means live within your means. We reap what we sow and what we sow is our harvest. What you earn is your harvest. If you keep borrowing against a future harvest, you are going to owe more than you can possibly pay back. Stop using debt today. If you stop today, and just pay your payments, you will eventually be out of debt even without a plan. A plan will simply get you to financial freedom quicker. Stop using debt to get what you want. Debt will never bring wealth.
- Develop a plan – No one builds a house without a plan and you will not build wealth without a plan. Whether it is a plan to get out of debt, a plan for retirement, a savings plan or a spending plan, you need plans in your financial life. Don’t go through life willy nilly – living on what’s in your head. Develop a plan and you will have success in all areas of life.
- Believe in yourself – If you don’t believe you can, you won’t. It’s that simple. Believe you can reach financial freedom. I believe you can because I did and if I can, anyone can. Believe you can and you will.
These are 5 things you can start today that will bring you wealth and financial freedom. They are the top things I did when I decided to pay off $200,000 in debt. It wasn’t instant and it definitely wasn’t easy, but it was worth it. Financial freedom will bring you a peace beyond understanding and especially in those moments like I have had recently. Financial freedom is worth every sacrifice. It is freedom!
Listen to Debbi’s podcast episode on this topic right here!
This past Saturday, I did what I do almost every Saturday from April to October – I went yard saling. For me it is a hobby – I really don’t “need” anything, but it is fun and you never know what kind of good deals or rare items you may find. In addition, once a year, I have a yard sale. I am always evaluating what I have and if it doesn’t bring me value anymore, it goes in the yard sale box in hopes it will bring someone else joy. The one thing I noticed as I go from neighborhood to neighborhood is that some people take this yard sale concept to an extreme. Some people selling think they are a retail shop and some people buying think everything should be a quarter. Today I wanted to share a few tips from both sides so that every transaction is a win/win.
Buy Like a Pro
- You want to be reasonable in your buying approach. You are at a yard sale so you don’t want to overpay; however, you don’t want to insult someone either. If the host of the yard sale is reading this, they will have priced items fairly and to move. Some people want close to retail and some, like me, just want to get rid of it. Don’t hesitate to make an offer, but be willing to walk away depending on the seller’s attitude.
- Know the value of something as much as you can. For example, this weekend a lady was selling Vera Bradley purses for $20 each – new. She refused to negotiate on the price. Yes, they were new; however, I could go to the outlets and get the same purse for $20 and it would be showroom new. I politely declined. If I were selling the same purse at my yard sale, I would have sold it for $12 and been willing to take $10. Again, don’t be afraid to walk away if it’s not something you really want.
- Take lots of small bills and change. When you have ones, fives and quarters, you have more negotiating power. It is awkward to offer someone $1 instead of the $2 they are asking and then whoop out a $20.
- Have a list of items you are looking for. This will help you to focus and not get too caught up in the goodies. I usually come home every week with one thing not on my list, but I always have the perfect use for it. If you get caught up in the sales, and who wouldn’t, your house will eventually be overrun with too many things you don’t use. And if you do buy something for the price and hope that you can find a use for it, if you don’t, make sure you donate it. This way it doesn’t take up residence too long and collect dust.
Sell Like a Pro
- You want people to buy your wares so make sure you price them accordingly. Would you rather have $3 for something or $0 for the same something? Remember, you are not a retail store. Your items are used even if they have tags on them. Price them accordingly and you will make more money. Selling 30 items for $1 is more than selling 4 items for $5.
- Price everything – when items are priced, people know exactly what you are wanting and they can decide if they want it or not or if they want to make you an offer. If it is not priced, odds are they will walk away. You can always change it if you see a lot of people looking and no one buying, but pricing everything usually brings more sales. I also have 10 cent, 25 cent and 50 cent boxes. People love those and they are great for the small stuff you don’t want.
- Run your sale Friday and Saturday if possible. I have had yard sales in both PA and in SC and in all cases, Friday was the busiest day. You get a lot of professionals and older people, but for the right stuff they are willing to pay. One year, I made $200 on Friday and $10 on Saturday. This all depends on the area and if it is a neighborhood sale or not, but give it a try if you can.
- Advertising is important. People need to know you are out there. We have a local circular that comes out every week with lots of sales in it. It is inexpensive to advertise in something like that and so worth it. There are also many free websites and social media groups. Let people know what you are selling and use catchy phrases like “huge yard sale” or “everything must go”.
- Be willing to negotiate. On Saturday of our sales, we have a half off everything event many times depending on what is left. Your goal, like mine, is to get rid of everything – not take it back in the house. So sell what you can for what you can and then donate the rest. Remember, your stuff is only worth what someone is willing to pay for it. Sell it, get something for it and move on.
This year I was just going to donate my boxes and not have a yard sale. Then my wise daughter said “Mom, have a yard sale, sell what you can and then donate the rest. You will have more money than you would donating it and you can donate what is left.” Those are wise words. We made over $200 and donated 2 car trunks full of stuff. That’s a win/win in my book. So whether you are buying or selling, have fun with it, don’t pay/charge too much and everyone wins!!
Debbi’s new budgeting course – “The 411 of Budgeting” – is now available in her store for only $19.95. For the price of a pizza, you could take the first step in the journey to wealth and financial freedom. Check it out right here along with her “Adulting Survival Kit” and all of her award winning, best selling books.