Most people have a little debt. A credit card that needs to be paid off, a negative balance for some online account. A few overdue library books.
Many people have moderate debt. A car they're paying off, or a manageable mortgage. But sometimes debt gets out of hand.
If you have debt that hangs over your head and warps your life, it's not unusual to get really freaked out. You may feel genuinely threatened by the collection agencies or so weighed down by debt that it can seem like your life is already over.
But it's not.
Here's the thing: Debt is just a number. It's something you're connected to, but it doesn't have to rule your life.
Today, we're here to talk about how to achieve financial mindfulness: a way to live with debt and let go of the stress.
The Difference Between Debt and Debt Collectors
Debt isn't as scary as most people think it is. By the books, debt is an amount of money to pay over time.
There are almost always programs available to make the debt easier to pay. Over time, a debt can be whittled away until you are debt-free.
But debt collectors are a different story.
But many people are harassed and followed by debt collectors. These collection agencies will lie, threaten, and even break the law to scare you into paying. And, in effect, create a feeling like debt can't be overcome and that it could crush you.
If you are being threatened by debt collectors, the first step to freedom is enforcing your rights.
You have rights against debt collection and can force debt collectors to leave you alone. Or, at the very least, treat you with more respect.
- Have your boss ban debt collector calls to stop them at work
- Officially ask them to stop calling you
- Consult with a lawyer who does contingency debt collection cases
A Necessary Expense
Without collectors, debt is really just another necessary expense.
It may help to think of your debt like an invisible pet. The payments cost a certain amount of food per month and year. In fact, a good debt repayment plan shouldn't be any more costly than a high-maintenance pet.
Or an average medical condition that had costs for medicine or therapy to live a full life. Only better, because debt will eventually go away.
There are some expenses we just have to pay. And your debt is just part of that.
There may be ways to decrease or even forgive the remainder of your debt. But the first step is to make debt repayment a normal part of your budget.
Your Household Budget
So the obvious next step is to rebuild your budget.
- Start with your income.
- Research to find the lowest reasonable rent on a low-cost apartment near where you work.
- Calculate the cost of monthly groceries on a tight budget.
- Add the total amount of your monthly debt payments.
If your costs outweigh your income, this tells you two things:
The first is that you can probably renegotiate your debt payments. Your creditors want to be paid which means they'd rather you keep working instead of going bankrupt.
The second thing is that you should think about seeking a promotion.
The best possible approach to debt is to get motivated. Debt is a hole that can be filled. The more money you make, the sooner you will be out of debt. And once the burden is lifted, all that income is still yours.
Living a Free Life on a Budget
Believe it or not, you can build a pretty good life under a lot of debt... without declaring bankruptcy or even lowering your quality of life that much.
You're just doing it with a smaller budget. The key is to get all your debts addressed so that you can actively make the full agreed payments every month.
With your debt repayment on-track, you can live free and clear of all the worry and stress about debt. Let it motivate you to excel, to repay and conquer the debt faster, and to live a full life in spite of the debt.
That is financial mindfulness.
If you want to live somewhere nice on a small budget, partner with a roommate. If you want to eat well, learn to cook at home.
There are many ways to live a great life for little money. 20-somethings have been doing it for centuries.
Decide what's important in life, cut costs for everything else.
Debt can feel like it's crushing you from the outside, but you can let go of debt stress by taking control of your finances. You can stop collector harassment.
You can renegotiate your debt repayment plan. In some cases, you can even get your debt reduced or waived by following up through the right channels.
If you'd like more expert advice on how to regain control of your finances and your life, contact us today!
If you are burdened with high amounts of credit card debt and are struggling to make your payments, or you’re just not seeing your balances go down, call Timberline Financial today for a free financial analysis.
Our team of highly skilled professionals will evaluate your current situation to see if you may qualify for one of our debt relief programs. You don’t have to struggle with high-interest credit card debt any longer.