Below are the basic steps to get yourself into a better financial state.
If you do not follow these steps DO NOT CONTINUE to the financial courses as you will only get discouraged and give up, placing yourself back in the same spot you are in today.
Ok, enough of the bla, bla, bla, let’s get started! 🙂
The Final Gathering
STEP #1 – Gather
- Gather all items in your personal carry on *Purse or Purses / Wallet or Wallets.
- I DO MEAN EVERYTHING! not just what you think you have… GET IT ALL!!! in the drawers, the car, wherever you store them.
- e.g. Driver’s License, Diving License, EMT Licenses, Certification Cards, Credit Cards, Gift Cards, Reward Cards, Discount Cards, Anything that looks like a Card – GET IT!
STEP #2 – Clear Space
- CLEAR a Space on a Table or get on the floor where there is room to organize.
STEP #3 – Pile it on
- Take all Cards out and place them all in ONE BIG PILE.
- Be amazed at your purse or wallet at how much stuff was in there! – AMAZING! Right!?
- How on earth were you carrying all that with you. Time to lighten the load.
TAKE A MOMENT TO BREATH!!! THIS WAS THE HARDEST PART.
Most people fail to do these 3 steps… resulting in failure later on. If you did exactly as described above you are on your way to financial freedom “mentally“. Now let’s continue – > You are almost done. 🙂
STEP #4 – Filtration: *(Getting rid of the Crap!)
- Take a look at the pile and now to organize it.
- 1st – Take out all Required items you MUST have and put it into one area. e.g. Driver’s license, SS Card, EMT Cards that must be with you at all times.
- 2nd – Take all Credit Cards and put them in one pile.
e.g. Visa, MasterCard, Discover, American Express
- 3rd – Take all Gift / Loyalty Cards and put them in one pile.
- 4th – Take ALL Gift Cards/Loyalty cards and put them into a separate wallet.
- (you might need to buy one just for this purpose). This way when you go out or find yourself in the “I wonder if we have a discount card” moment, you will know where to look. It’ll all be in one place.
- 5th – Take all Credit Cards out and organize them by importance.
- Keep 1 card on you (Probably VISA) for an Oh, Crap! Moment only.
- Take all remaining cards and put them aside and organize them from Smallest to Largest debt. If you don’t know your amount CALL THE # on the card and find out!
- e.g. JC Penny MasterCard #1 = $284.24, Amex #1 = $ 334.35, Discover #1 = 3,203.75 etc…
- Gift Cards are purchased as “cash value“ items are meant to be given away to other people as gifts!!!!! *Put in your gift card wallet for later use.
- Loyalty or reward cards are meant to be kept by individual customers to help them earn points over time, and eventually, they’ll convert those points to some sort of gift or gift certificate. If your reward card is your gift card, you could never give it away!
= CRAP!~ TRASH THIS AND NEVER USE IT!!! EVER!!!
- Unused Cards are called and made sure balance is ZERO and then CLOSED!
- Then DESTROY IT!
STEP #5 – Break Time
- Use this time to finish up any calls on finding out remaining balances and closing out cards that you no longer use. It might take a day or two, which is ok. Don’t forget to come back and finish up.
STEP #6 – Debt Snowball
You’ve probably heard about this strategy before, but I’ll say it again ~ IT WORKS!!!
- 6th – Organize your debts in order from smallest to largest.
- $50.00 = Debt #1
- $780.00 = Debt #2
- $1,200.00 = Debt #3
- $5,300.00 = Debt #4
- 7th – Pay MINIMUM payments on everything just to survive.
- Any extra money MUST go towards the smallest debt to clear it off.
- 8th – Continue to pay minimum payments on everything, but now that debt #1 is cleared you now have extra money to pay towards debt #2. So now You’ve essentially increased your minimum payment for Debt #2 which in turn pays it off faster.
- 9th – RINSE and REPEAT
- You attack the smallest debt first, still maintaining minimum payments on everything else. Do what is necessary to focus your attention and not get distracted by life and others trying to keep you down! Keep stepping up to the next larger debt.
You now have the secret to becoming financially Debt Free! Whoot Whoot! 🙂
Stick with it and remember it gets easier once you START! Don’t worry about all the nay Sayers and party snobs out there who discourage you when you say you can’t go out and join them to spend money. If anything remember this.
IT’S A TEMPORARY PAIN BUT IN THE END A LONG TERM GAIN!
Good Luck and Stay on track! ~ Aaron