Many questions I get from listeners and readers are about getting out of debt. Some people have tried to get out of debt more than once, but it doesn’t seem to work.
In this article, I’ll show you how eleven proven ways to stay motivated when you’re paying off your debts.
1. Get mad
My first dose of debt was nine months after graduating college. My student loan bill started rolling in. It killed me each month to visually see all the money I was paying in interest.
Yes, I got a great education. I wouldn’t be where I am without my college degree.
But it pained me no less to see $98 out of $100 going to an interest payment.
And I was being given the opportunity to keep doing this for ten years? No way!
Go take out one of your debts right now and put the bill down in front of you. Stare at it and look at how much money you’ve just thrown away – **burned, in fact, ** – in interest.
You will either get:
- sick to your stomach
I can’t imagine any person saying ‘oh, well, I’m so happy to keep paying this for the next ten years’. Can you?
No matter what emotion rises to the top for you, one thing is certain – you will be motivated.
The people who aren’t motivated by their debts don’t face them head-on.
They don’t look at the credit card bill.
They see how much they owe on student loans this month and write a check for the minimum.
They know nothing about car loans and how bad the are for your wallet.
Look at that bill, and then react.
2. Focus on how your life will change
Here’s another writing exercise. If you do this exercise, you will be much more likely to stay motivated. If you have the mindset of ‘this is a bunch of bologna’, try it anyway and give me your opinion afterward.
What does getting out of debt mean to you?
Write down ten ways your life will change when you’re out of debt.
- Will you be able to work at a job you love?
- Will you be able to pack up and go where you want to?
- Will you be able to work less?
- Do you just want a good night’s sleep without stress and worry?
Now write down ten ways your life will look if you don’t.
Keep that list handy to review it as you work to get out of debt.
3. Stay laser focused
My wife loves having a vacation to look forward too. Next year we are planning to go to Ireland on another Rick Steve’s tour.
When the kids are screaming, when it’s 100 degrees and humid outside in August, when it’s just a bad day – there is a vacation on the horizon, even though it’s thirteen months away.
Amidst all the daily crud – stay laser-focused on the one big thing getting out of debt means to you.
Ask yourself daily:
What’s my life going to look like when I get out of debt?
When you start daydreaming of the peace, the freedom, the life you deserve to be living – you’ll get a little bump to make it through another day.
4. Review your goals EVERY day
Your goal is to get out of debt. But have you written that goal down anywhere? Do you see that goal staring you in the face every day? Or is it a wishy-washy goal like ‘oh, I’d like to be rich someday’.
People who write down goals are MUCH more likely to achieve them.
A Harvard MBA study tracked students who set clear written goals. The 3% of students who had written goals were earning, on average, ten times as much as the other 97% of the class combined!
In my smart phone, I have a list of goals I want to achieve for the year. Every morning I look at the list. Doing so imprints in my mind what my life is about. What I’m living for.
You can have big goals or simple goals.
5. Keep on learning
There is an abundance of financial blogs and articles you can learn from (not just mine). They all have tips and tricks to saving more and spending less.
The more you know, the more you’ll save, and the faster you’ll get out of debt. The better you learn to control your money, the less likely it is to control you.
6. Do a little each day
I know you’ve heard this:
How do you eat an elephant? One bite at a time!
You have a mountain of debt. You get to the top of the mountain and out of debt one step at a time.
Keep chipping away by making smart decisions each day.
7. Find some support
It may be your friends and family aren’t excited about you getting out of debt. When you try to get out of debt those closest to you may react negatively.
It’s human behavior.
You’re trying to improve your life. Your life is going to be better than those around you. You’re going against the norm of having a car payment and living below your means.
Some people will try to drag you down because you’re seeking a better life for yourself, and they don’t have the desire to change for the better. They would rather see you stay at their level.
There are lots of places to find encouragement outside of your network of family and friends:
- Facebook groups
- Personal finance blogs
- Twitter chats
- Periscope chats
Reading the stories of other people and how they got out of debt is a great motivator.
8. Find an accountability partner
With the Internet, it’s easier than ever to connect with people who are in debt, or who have gotten out of debt. Reach out to them and just ask for some help each month to stay accountable.
It can be as simple as meeting once a month in-person or via Skype. You will stay motivated and on track, and you’ll motivate someone else to stay on track too. There is a lot of power knowing:
‘Uh oh, in 30 days I’ve got to report into Barb and John. I don’t want to look like a failure.’
9. Stay patient
Yeah, you’re right:
That’s easy for you to say, you haven’t seen the size of my debt!
Nope, I haven’t. Each of us has a different number. Your number may be bigger or smaller than someone else. We each have different incomes too.
When I had debt, it was large compared to how much income I was making (just out of college). When I started earning more money – I took on more debt! I was a money moron, remember?
It took years to accumulate debt. It might take years to shed it.
Are you doing everything you possibly can right now to get out of debt?
If the answer is yes – congratulations! All you have to do is check the days off a calendar until your debt payoff date arrives. It’s easy to say that but the reality is that’s all you can do. It is what it is.
10. Reward yourself and have some fun – reasonably
I’ve been a gym rat most of my life. If I were to train someone to lose weight, I would never say ‘we’re going to go on a diet for the next twelve months. You can have a piece of cake as a reward a year from now.’
What a great way to motivate someone, right?
But you also can’t take the opposite extreme – ‘if you work out three days a week, you can eat all the cake you want every Saturday.’
The person who has a cheat meal (or day) every week is a person that never loses weight.
- You’ve paid off a credit card in full? Celebrate!
- You’ve paid off another $1,000 in debt? Celebrate!
- You’ve stuck to your first ever spending plan for 90 days? Celebrate!
But don’t go into more debt for your celebration. Be reasonable and use your common sense so you maintain momentum and are heading in the right direction.
Reasonable is a loose term. It doesn’t mean getting to play a $150 round of golf every month or going out for sushi (expensive).
Giving yourself a small reward no more than every 30-days is reasonable. If you want a hard number, I would say $20 a family, or $10 if you’re single.
That’s 2–5 pints of Ben & Jerry’s ice cream, which is an awesome reward. Ben & Jerry’s always motivates me. What motivates you?
Plan your rewards
Make sure you carve out in your spending plan how much you’re going to set aside for a reward.
Then mark the date on a calendar. Count down the days and watch your target date grow closer. You will be motivated.
11. Record your progress
Paid off a debt?
Finally have an emergency fund?
Record that and plaster it on your refrigerator. PAID IN FULL!!!
If you’re into journaling, keep a diary of your journey. A blog is a great way to stay motivated and share your journey with others. You end up helping others and you get the motivation to keep on going.
The ultimate freedom
You will never hear someone say:
I’m glad I’m finally out of debt. But I really wish I was back in debt again!
The sacrifices you make now to get out of debt later are well worth it. Ask anyone that has gotten out of debt.
It’s simple, but it ain’t easy. There are a lot of obstacles, it takes time, it’s painful, but the rewards of being debt free are unspeakable. You’ll find out when you get there.
Remember your big reason
At the end of the day, you need just one big reason beyond everything else to keep you going til the end.
I have a big reason to stick to my budget and not overspend – I want to work for myself, set my schedule, and watch my kids grow up at home. If I blow up my budget, I could end up back in the corporate world someday.