Paying off a mountain of debt can be a long, arduous process. Determination can get you a long way, but if your debt journey is going to take several years, you may start to get impatient, lose hope or be tempted to spend.
Here are four mental tricks you can play to keep yourself motivated and stick with your debt payoff plan.
1. See what a difference extra payments can make.
For instance, make a simple spreadsheet in Google Drive that lists all debts, the minimum payment and the amount that goes to principal each month.
Then add a formula that shows how long it will take to pay off the amount at the current rate (debt/amount going to principal = months it will take).
Under the debt you’re trying to pay off first (or under the total debt), make a second formula that shows how much sooner it’ll be gone if you put an extra $50 (or $500) toward it monthly.
Suddenly you can envision paying a debt off in months versus years. As you update your numbers, you’ll see the number of months decrease and feel that much closer to freedom.
2. Imagine your budget without that debt.
If you’re trying to turn your financial life around, chances are you have a monthly budget of some sort – a list of all expected monthly income minus the bills, spending and savings you expect every month. (If you don’t, I highly recommend it!)
If your debt journey is a long one and you’re feeling really antsy about putting so much extra money and effort toward debt, create a future budget. Keep everything the same except your debt payments.
Just looking at it may make your whole body feel less tense. Stick with your plan and you’ll get there with fewer obligations and more freedom to use your money how you want to.
“If you stick with it, it will
all seem worthwhile.”
3. Find someone to help you celebrate your achievements.
A debt payoff journey can be a lonely one. Your friends may seem like big spenders compared to you, and your progress may be invisible to everyone outside your family. But you’re not alone!
Find a like-minded friend to share your story with. If you don’t feel comfortable approaching anyone in real life, start a blog on a personal finance site where you can talk about your goals, successes and challenges.
Personal finances are the final taboo. Most people can talk openly about just about anything except their finances.
Being able to tell someone what you’re going through, whether they’re an anonymous Internet buddy or a friend you know in real life, can make it feel more momentous as you reach each little milestone on your journey.
4. Create a pressure valve in your budget.
Throwing absolutely every penny at debt might work for a short period of time or for certain personalities, but for the average person, constantly depriving yourself can start to wear on your psyche.
As you pay off one debt after another, you may have more wiggle room in your monthly budget. At the same time, your income may increase through raises, bonuses or other windfalls.
You could snowball all of that extra money into paying off the next debt on your list, but if you’re starting to feel the strain of so much self-denial, you could also divide the money you’ve freed up, putting a portion toward extra debt repayment and keeping some for things you enjoy.
You’re on a difficult journey that offers little tangible reward along the way, but if you find ways to stick with it, it will all seem worthwhile.
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