Top 5 Reasons to Get Out of Debit is a guest post by, Sarah Rexman. I would like to tell her thank you so much for taking the time to write this article to help people see why getting out of debt is so important and what it can do for us and our families.
In theory most everyone will agree that debt is a bad thing. However, this knowledge doesn’t seem to be enough to motivate most people to stop going into debt, let alone work on getting out of debt. Getting out of debt is fairly straightforward. Set up a plan that focuses all of your extra payments on one debt at a time and put as much extra money towards the debt as possible. Once one debt is paid off you move to the next one on your list. Here are the top five reasons you should work on getting out of debt now.
1. Freedom to Do What You Want
Debt is like being locked up in prison. It can seriously limit the choices you make each day. Debt will keep you working a job you hate every single day. It will stop you from buying the things you want or from going on the vacations that you want to each year, because of the amount you pay towards debt each month. It can also limit the time you spend with your family or your friends or doing the things that are the most important to you, since you have to focus on working all of the time. Without debt you may be able to find a job that pays a little less, but that would allow you to spend more time with your family and doing the things you love the most.
2. Debt Limits Your Financial Security
Carrying debt limits your financial security. If you were to lose your job, your severance package and unemployment benefits would not last as long or go as far because you have the obligations to your creditors. A creditor can put a lien on your house, so they get the money if you sell it. They may also garnish your wages if you fail to pay a debt. This may make it even more difficult for you to make ends meet. It is important to get out of debt so you can begin to build real financial security, and so you do not have to worry about what will happen if you cannot pay your debts. It is easier to make ends meet when you only need to pay for your daily living expenses such as food and power, as opposed to credit obligations.
3. Debt Prevents You From Building Wealth
Debt will prevent you from building wealth. Most credit cards charge a monthly interest rate of around fifteen to sixteen percent. This is very high. As long as you are paying interest to someone else each month, you are not going to be able to save money and begin to have a positive net worth. Look at your credit card statement and see how much you pay in interest each month. Now consider what you would do if that money magically appeared in your account each month without you doing anything. When you build real wealth, your interest will eventually begin contributing more to your savings account then you do each month. Once that happens your wealth will being to build quickly, and you will be a place that is comfortable and secure. Stop paying interest so you can begin to earn it.
4. Debt Adds Unnecessary Stress and Worry to Your Life
People who have an emergency fund, savings in the bank and not other debt obligations rarely worry about money. They feel secure because they know they will be okay if they lose their job or if things take a turn for a worse. While people who have too much debt worry constantly about money and how they are going to afford to make the next payment or how they are going to get out of this situation. Life is much easier when you are not constantly stressed out and being debt free can help reduce a lot of stress in your life.
Debt can stop you from achieving your dreams. This happens in a few ways. First you may be forced to stay in a job you hate because of your debt payments each month. Second you may not qualify to purchase the things you want most such as a home, because of the amount of debt you currently carry. Finally you may not have the free time you want to pursue your dreams because you are obligated to make money to get out of debt. All of these factors may make it very difficult to go after the things you want the most. Getting out of debt will free up your time, and your resources so you can do the things you want to the most.
About the Author:
Sarah Rexman is the main researcher and writer for her extensive bedbug site. Her most recent accomplishment includes graduating from Florida State, with a master’s degree in environmental science. Her recent focus for the site involves how to do a proper pest control test in your home.