Starting Anew: Sweeping Your Debt Clean


Pushing to sweep your debt clean does not need to wait for the annual New Year’s Resolution list. This is something you can do all year round to keep your debts light and bearable. However, to get started with cleaning your debt slate, you must understand that it will need your 101% commitment and motivation to ensure that everything will settle accordingly.

First things first, having a debt is not necessarily a bad thing as long as your debt leans on what they call “the good debt”. Basically, there are two kinds of debts – the bad debt and the good debt. The good debt may only be categorized as good if it is an investment, which will earn value over time. Some debts that can be considered good are college student loans and house loans. A college student loan can be classified as good debt because being in school and striving to finish your studies will definitely add worth to your general well-being.

In addition, this can also mean that you may be able to find a good paying job after you graduate. As for house loans, these will be considered as good debts as well. The house that you desire to buy will surely be of value and with proper upkeeping, its worth can increase in the future making it possible to resell if you will be moving out.

On the contrary, if you will only be purchasing items, which are considered as consumables like bags, shoes, or clothes, your debt will definitely fall on the bad side. Bad debt will arise from purchasing items, which will just depreciate no matter what the upkeeping you do is and will have no value in the future.

Now that you have a clear differentiation of what good and bad debts are, you will be able to get rid of bad debts effortlessly. Here are ways on how you can get started:

Keep Your Commitment Levels High

These factors are very important. Everything will just go down the drain if you are not serious or just half-hearted in cleaning your slate clean. If you have these two as foundations, your goal of sweeping your debts away will surely come to fruition.

Make Your Plans Go R.A.R.

You have to make sure that your plans follow R.A.R. or Realistic. Attainable. Reasonable. Your plans must always be realistic to ensure that you will not get overwhelmed in the future as well as not put too much strain on you.

Make sure that they are also attainable. You have to set your plans while taking into consideration what you can and cannot do so you may know that achieving your goal is not next to impossible.

Reasonable is also another thing that your plans must have. Reasonable plans ensure that you will be able to pay off your debt without putting you in a tough financial situation and will not compromise the everyday necessities you have to buy.

Save Some Salary

Save some of your salary each paycheck the right way and always keep track of your incoming and outgoing money. When you are trying to pay off your debt, you have to keep in mind that you do not want to put a chunk of your income or salary in paying the debt just so you can complete paying early. This will not do you good and may even cause harm and stress. Divide your salary into three budgets – necessity, savings, and debt payment.

This will help you to still live well, have enough money in case of emergencies, and pay your debt even if it is just little by little. Then, remember to track your incoming and outgoing money to ensure that you will not be incurring further debts and to be able to know how much more you can keep or spend.

Doing all of these may seem a little too difficult at first, but keep your stand firm and stick to your plan and you will surely be able to pay off your debt in no time.

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