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Name Every Dollar
More Money Will Not Help You
Name every dollar and you won’t go broke. You get a raise every year and you are still broke and deep in debt. Your tax refund came in and for some reason two weeks later you are broke again and piled up more debt. You are one paycheck away from a financial disaster. What are your options? What can you do?
You can get a second and third job. Chances are you will spend that money, too. Go ahead and start a business. Do you have the time and patience to learn a business and make it successful? What business will you start? Will it be offline or online? Will your spouse or partner agree? Do you have the money to really invest or will you listen to some expert and go into more debt with a venture you don’t understand? Oh yeah, you are still broke.
More money will not solve your problems. Most people get raises and windfalls and still live from paycheck to paycheck. Athletes and entertainers make a boatload of money and end up broke. More income is not a problem solver. Naming every dollar is.
Beating Personal Debt
I beat debt by naming every dollar and coming up with a monthly budget. Also, owing the IRS, the state franchise board, student loans, personal loans, business loans, and credit cards. Furthermore, when I decided that I was going to become debt-free, and even put #DebtFree2014 on my Instagram photos. I picked up the book The Total Money Makeover, by Dave Ramsey. I read it 5 times within 7 days and implemented everything in it. That was November 2013.
In January of 2014, I joined Financial Peace University and within 9 weeks I paid off all my consumer debts and saved over $12000. I only owe student loans. As of today I still put 20% of my income towards paying off my debts. January 31, 2015, I will be debt-free.
How did I do this in such a short period? By naming every dollar. I got control of my money and I became the master of it. No longer will money control me. No longer will I be a slave to debt and bill collectors.
It will take about 90 days for you to get used to living on a budget. When I did my first cash flow plan (budget) I saw that I had an extra $500 to put towards my debts. After 90 days I had an extra $1100 to pay my debts. I did this all with the same income.
