The Value of a Debt-Free Existence

No one can dispute the wonderful feeling of serenity and comfort when one can state that he/she truly owes no money to anyone. There is no stress and discord when the mail arrives each day, and no loss of sleep wondering how to get debt paid off. The additional value of being debt-free, however, is they way you can make the most of your personal financial position to begin to accumulate great amounts of savings for your future financially independent lifestyle.

Become Debt-Free

No matter how much debt you may now have, you do have the means to eliminate that debt by choosing from a variety of options. Even the most stressed debtor with overwhelming debt that cannot be met on a monthly basis, has options to clean up the mess. Among the options are the following:

1. Attack each credit card or revolving debt, one at a time, dumping every penny available on one debt at a time until it is eliminated. This will require suspension of non-essential expenses, but the benefits will be so worth it. Ease the pain and motivate yourself by one splurge or reward as each debt is paid off. Confide in a friend so that there is support and encouragement. Announce your intention to as many as you wish to tell. When others know what you intend to do, you are more apt to stick with your plan.
2. Get rid of your credit cards. Cut them up and cut up any replacement cards that may come in the mail. It is usually wise not to close the accounts, because that can damage your credit rating some. If you do not have the self-control, however, close the accounts. Your credit score is not the big concern right now.
3. Don’t trade your car in as soon as it is paid for. Continue to drive it for two more years. The savings of not having a car payment will be substantial and can be used to pay off other existing debt or placed in savings.
4. Consider a counseling or consolidation professional if you are unable to accomplish debt elimination yourself. They will negotiate with your creditors for lower total debt amount and help you secure a consolidation loan if necessary. The fees you pay will be well worth it if you cannot do it yourself.
5. If you are completely drowning in debt, consider bankruptcy. Chapter 13 will establish lower overall debt and monthly payments you can afford for a 3-5 year period. Chapter 7, more difficult to get, will eliminate your debt entirely, but consulting an attorney will be necessary for either of these steps.

You are Debt Free – Now What?

The other value of being debt free is the opportunity you now have to begin to accumulate savings and investments at a much faster rate. All of that money that was going to pay off debt can now go into interest-bearing savings or dividend-paying investments. If that savings interest and investment dividend is re-invested, it simply allows additional growth. Savings and investments accumulates quickly if not touched, so be certain to keep some amount of money each month for current enjoyment.

If you didn’t get out of debt and need bankruptcy, here is a useful resource: Illinois Bankruptcy Lawyer

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