Take some time and sit down with your finances. Develop a bare bones budget, based on what you need to survive. These figures should include things like your rent or mortgage, basic utility bills, food, gasoline, and a car payment if you have one. Do not include extra items like cell phone packages, cable TV, or other expensive luxuries – this budget is made up of the essentials that you need for survival. If you’re lucky, you’ll have enough to meet all your needs, with some extra money left over. If you don’t have enough to meet your basic needs, it’s time to find some ways to increase your income.
If you have enough to pay all your bills, with a bit left over, you’re better off than a lot of people. While it may not seem like it, you’re actually quite rich, and it’s important to keep this in mind. If you budget your money carefully, you can meet your needs and begin climbing out of debt, slowly but surely. The key is to keep an attitude of abundance – to spend time being grateful for what you have. Take a few minutes each day to write down three things you’re thankful for in your financial life – simple things like having the money to pay the electricity bill or to buy your kid’s a special cereal at the grocery store. When you’re drowning in debt, it’s easy to forget to be thankful for the small things. This gratitude journal will help you remember your blessings and help you to keep the right mindset.
Set Some Goals
Goal setting is another key to a debt-free mindset. Spend some time looking over your bills and expenses, and set a few goals to work towards. These can be things like getting current on your utility bills, beginning a savings plan, or taking action to achieve one of the steps in the plan I’ll be presenting to get out of debt. Set a clear, concise goal that you can work towards, and then add a date you plan to reach it by. The date provides a sense of urgency, and is an extremely important part of the goal setting process.
Once you’ve set a date, mark it on your calendar! Then, working backwards, set a few smaller goals leading up to your large goal. These short term goals will help you stay focused as you work, helping you to keep your eye on the prize. You might even add a small (inexpensive) reward for achieving each small goal, with a bigger reward for achieving the larger goal. Doing so will help make getting out of debt fun, and allow you to focus on just how much you’re achieving.