Whether you’re in debt with credit cards, student loans, car notes, or house loans, we all have some form of debt.
The thought of paying off your debt might seem stressful at first but imagine what a debt free life could mean for you.
Debt keeps us from saving money, investing it, and reaching financial freedom.
So, what’s the best method to eliminate debt?
The Snowball Effect
Snow!
There are a few proven methods to paying off debt. We favor the snowball effect method due to its quick momentum and effective results.
This is how it works
You start by paying down your smallest accounts first while making minimum payments on the rest of them.
The approach is to eliminate your smallest debt aggressively. Once you’ve paid off your smallest account, rollover that payment onto your next account.
By the time you’re paying off your third account, the amount equivalent to your monthly payments from the first two will have a drastic effect moving forward on your outstanding balances.
Avoid This Mistake To Stay Debt Free
Don’t spend more as you earn more
In order for the snowball effect to build momentum, you must be consistent and not divert from rolling over once your first debt has been eliminated.
Most people will fill in the space with something else once they’ve paid off their car or credit cards for example.
This spending habit pulls you back to a never-ending cycle.
Remember, once you’re debt free all that disposable income is yours to enjoy. Save it, grow it by investing, and enjoy it!
Don’t let income creep lifestyle keep you from reaching your financial goals.
This is how people making six figures a year can be in financial ruin just as much as anyone making five figures.
Continuously work towards earning more income to pay off your debt more aggressively.
The sooner you payoff one debt, the sooner you can move on to the next while eliminating accruing interest.
Create A Budget
Use a loan calculator for your student loans to understand and save better on bigger payments, as well as finding areas you can budget for, such as junk food, streaming services, and other non-essentials.
You’d be surprised at how much you can save a week by meal prepping instead of eating out daily.
Write down your expenses and see where you can cut back. This strategy will help you not only develop a winner habit but play an important role in your journey to a debt free life.
Mint is a great app that breaks down your expenses and allows you to have an overview on all your account balances.
It Takes Discipline
The fact that you’re here shows your willingness to make this incredible change in your life.
Financial freedom is an amazing experience we all deserve a chance to.
Realistically, only by taking the necessary actions to see our goals through will we truly reach a debt free life.
It’s time to live in the moment and focus on the things that truly matter to us the most.
Be consistent, stay on top of your goal, you have the power to do this.
Financial stability is the 3rd level of wealth according to Dan Lok’s 6 levels of wealth pyramid. It is the level beyond financial dependency (level 1) and financial survival (level 2 ). Financial stability bears a financial stress-free lifestyle but requires definite discipline and planning. If you’d like to find out more about Dan Lok’s 6 levels of wealth be sure to check out the video below. Here’s how to reach financial stability at any age.
What is financial stability? Financial stability is the level of wealth when you no longer depend on someone financially, and have essentially stopped going paycheck to paycheck. Financial stability requires that:
Your income is greater than your expenses
You have anywhere from 4-6 months of monthly living expenses saved up
You have no bad debt (high credit card debt, bad investments, etc.)
There is no set income number to reaching financial stability and you can reach it at any age. It does not matter how you make this money or how much you make, but how you manage your money.
E.g.: A person earning six figures a year cannot be financially stable if they are living paycheck to paycheck with no money set aside for an emergency. A person earning significantly less can be wealthier by simply having the discipline to manage their personal finances responsibly.
So How Do You Become Financially Stable?
First, you must truly want to become financially stable. In order to reach financial stability at any age it will require sacrifices involving budgeting, saving, and lots of planning.
Assuming you are not financially dependent on anyone and you work for yourself, you must learn to stop living paycheck to paycheck. This is achieved through gaining a set of skills and financial knowledge from which you can put to use.
In short, you will need to:
Look At Your Bank Statements and Budget
Increase Your Income
Live Below Your Means
Increase All Monetary Accounts
Develop Winner Habits
We break down in complete detail how to stop living paycheck to paycheck here. Reach financial stability at any age by living below your means and eliminating living paycheck to paycheck.
Write Down Your Financial Goals
It is important to write down your financial goals in order to materialize said goals. Type them out in a word document or write them down in a journal. Your subconscious mind sees this and allows a lot of powerful and intuitive things to occur in your mind. Working towards your financial goals will become second nature.
Writing down my goals helped me reach financial stability because I was constantly setting goals for myself. Keep planning and keep writing down your goals.
The comfort zone is where all dreams and goals die. Be prepared to leave your comfort zone if your goal is to reach financial stability. This step will require you to ditch the habits prohibiting you from reaching your financial goals.
If you want to reach financial stability you will need to develop some habits you might not like at first. This means delaying gratification to meet your future goals.
Take Action To Manifest Your Financial Vision
Begin to set things in motion by taking affirmative and disciplined action. Stick to your budgeting plan and keep working towards eliminating unnecessary expenses while earning extra income to pay off debt. Think in terms of weeks and months. Look at the progress you make at the end of every week and every month.
Learn to reach financial stability at any age by continuously taking action towards achieving your goals.
Take action every day and you’ll grow every day.
frank nez
Let Your Goals Motivate You
Record your progress to boost your motivation. This helps to visually see how much closer you are to accomplishing your goals. Motivation is at its highest in the beginning and may begin to settle as time passes. When it begins to subside, remember why you started in the first place.
The process will take time. Remember, one step is one step closer to achieving your goals. Reach financial stability at any age by staying motivated throughout your financial journey.
Some ways to stay motivated include:
Watching successful mentors on YouTube
Reading self development books
Following motivational pages on social media
Maintaining focus on your aspirations
Reaching financial stability requires you to ditch old habits and gain new ones.
Another great way to stay motivated throughout your journey to reach financial stability is to never stop learning. Continue to educate yourself while you take on this amazing responsibility.
There is a lot of great content on YouTube from which you can gain new perspective and knowledge from. Some of our favorite people include Dave Ramsey (saving), Grant Cardone (motivation), & Andrei Jikh (investing). You will find loads of content that can benefit you when you envelop yourself with financial betterment.
Franknez.com writes a lot of content relating to your financial benefit. We take pride in helping our readers become financially confident.
Tip: Learn how to reach financial stability at any age by learning from all type of successful people.
How Do You Reach Financial Stability At Any Age?
You reach financial stability when you decide to become financially literate. Financially literacy is the understanding of managing your personal finances responsibly.
You can only fathom financial literacy if you have the willpower to seek the knowledge. You must truly want it. No amount of money greater than what you currently earn can make you become financially stable. However, it can certainly become a tool to help you reach financial stability.
Every post on Franknez.com plays a dedicated role to working towards and building your financial future. Reaching financial stability is a mix of several habits you must learn to develop before attaining this level of wealth, just like any other level of wealth.
Financial Stability Is A Mental Stability
Mental stability manifests financial stability due to a variety of factors of which include:
Discipline
Planning
Desire To Learn
Commitment
Time
Sacrifice
This level of wealth is where you decide it’s time to change your life. It’s when you stop doing a variety of things that were holding you back and focus on taking control of your destiny.
In other words, it’s when you replace your bad habits with developed winner habits. Only you can truly decide financial stability for yourself.
If you found value in this post comment below and let us know how you’re taking the necessary measures to reach financial stability! Kuddos for being here today.
