Steps on How to be Financially Debt Free

Happy New Year 2010  Everyone.

After listing down my goals for new year 2010 about how to improve my family time.  I am thinking of how I can grow my finance or improve my money matters for this year.

Looking back 3 years ago when I was so much in debt and having problems with my finances. I can say that I have grown so much now.  I am now completely financially confident.  Free of debts on which I cannot pay.  Free of high interest rates (or should I say in our country what we called 5/6).  I have freed myself from all my debts.  I don't have to worry and spend sleepless nights thinking about how I will be able to pay all my debts.  The debts I had before almost broke my family apart (but that's another story). Now, I am so much financially in control.  Thus, I am so much in control of my LIFE.   But the path to freedom is not easy, it took me a lot of courage, patience, confidence, self control, willingness to learn and take effort, and prayers to be free from all of it.  

How did I do it?  Well, you must have a PLAN and plans have a series of steps.  The following could be some of the steps you could undertake to help you little by little to be financially in control.

1.  Evaluate your income and expenses.
Make a breakdown of your monthly income and expenses.  Compare your income vs. your expenses. 
Are your expenses higher than income?  Then, you need to do something about it.

2. Cut down your expenses.
Find a way where you can minimize your expenses.  Eliminate unnecessary expenses.  Stick to the basics.
Do not spend too much on food or other items that you can live without.  Focus on needs first then if you are financially free then you can focus on your wants.  If you could cut down on extra house bills such as cable or phone bills then do it. This might just be temporary.  Always remember your goal is to be financially free of debts so that you can be in financially control later on.  Take note - No pain, no gain.

3.  Allot a budget for payment of debts.
The key to being financially in control is no debt at all.  So, you must first pay all your debt (zero is the best). Allot more payment to your debts which give you higher interest. If you cannot pay all your debts now, pay it in a way you can afford but not so little that the interest would be more than the payment.  Meaning to say, pay more than the minimum amount required to pay.  Make a timeframe on when you will be able to pay all of your debts.  Month by month, create a system that will enable you to see how much you still have to pay and when you will have zero debt.  If you owe money from a person. Talk to that person or to your debtors if there is a way that they can reduce the interest. Tell them of your plan to pay and how much you can pay.

3.  Stick to your budget.
When you have establish your budget, stick to it.  Don't overspend.  Spend only what you have.  If you spend more on what you allot, you will be in big trouble. Stick to the payment of your debts because you have made a plan out of it.  This step will take a lot of self control.  Evaluate your budget every day or every week to see if you have followed it. You will have to be patient in making and reflecting about your list. This is an important part of your plan. Give some time for this because it will help you a lot. This will also remind you of your financial goal.  If in case you overspend, you have to adjust the other items in your budget. During the first few months that you are sticking to your plan,  you can make a list of your expenses every day on a notebook to see if it is effective then summarize the daily list into monthly list. 

4. Control your WANTS.
Focus on your needs.  Do not indulge yourself to a shopping spree if you are still in a big debt.  Control your wants.  Don't think now that you deserve it because your aim at this point in your life is to be free of debt.  You deserve to financially free and confident but first you must WORK on it.

5.  Buy items with discounts.
When you have made your list of things to buy, always look for items which offers discounts.  You can also cut some coupons of the items that are on your list. 


6. SAVE, SAVE AND SAVE.
If your budget would now allow you to save an certain amount then do it.  Open a savings account then later on invest on some certificate deposits.  This is the start of building your financial life.

7. Believe in yourself.
Believe that you are capable to be in control of your money.  Believe that you can change and improve your money affairs. Believe that you can be free from all debts and manage it well. 

8.  Prayers, prayers and prayers.
You might not believe this but the reason that I was able to continue my finance path is because I pray a lot.  I pray that I would be guided and would always make the right decision. I pray that I would be comforted from all my miseries and lighten my load.  I pray that our family would be blessed and protected.  I always pray that I would be financially blessed.  I could say it has really worked for me.  I believe in the power of  PRAYERS. It is really powerful.

The above steps are the basic steps to be free from any debts and improve your financial life. 
In my next blog, I can give some ideas on how to continue your path to financial freedom. 
This is just the beginning... Good Luck and May you be blessed always.

My Goals for New Year 2010 - Part 1

It is year 2010.  The Year of the Tiger.  My year.  Thus, I am thinking of my new goals for this year because it's my special year.  Would you believe I'm quite excited. It's been awhile since I set my goals for a year.  Last year, I didn't do any goals so I thought today, maybe, I can do some this year and things might come up pretty well. Hmm!  Now, what could be my new goals for this year. I am thinking of different dimensions of my life - FamilyTime, Home, Personal Interests, Health, Work and Finance, and Faith.

Today, I can start with my family goals.  Here, there are:

1. Celebrate every weekend with my family.

I am thinking of taking advantage of spending my time with my family. I want to enjoy their company and I want them to enjoy mine, too.  Family is one of my priorities this year. Family is one reason why I love to live. Therefore, I would like to celebrate every moment I spend with them especially on a weekend. It doesn't mean that I have to spend a lot.  Just sitting with them on the sofa and watch a video that everyone likes with a popcorn is worthwhile.  I can celebrate breakfast with them. Prepare dinner and eat with them (maybe with a candlelight). Tickle them before going to bed. (By the way, they would always beg to sleep in our room and my hubby would not always say yes because he has other plans - maybe I can give them a chance once in a while to camp and sleep together in our room or maybe a real camp.)  Another way to celebrate is to play computer games with them.  I love to play games! There are many other ways... I might write a different blog for this...

2. Plan for an awesome vacation.

It will be a refreshing time for me, my loving husband and my kids (I have two active boys  aged 10 and 7) to spend a very very very good vacation (that's what I called awesome) somewhere - out of town.  It is always good for families to spend at least once or twice a year out of town for 2 days or three. It will be an opportunity to strengthen family bonding and enjoy life.  This will depend on my budget, of course.  From my inspiration of our last vacation just 3 days ago, we are planning to spend a vacation again this spring.. and right now I am excited..(By the way, we had so much fun the past 3 days - and I can tell you that next time). I can't wait until it's spring. But when going for a trip, plan it well so that you can also spend less money and use time wisely. ( I can give you tips on how to save and plan for  a trip).

3. Assist my kids on their academics and support their personal interests.

I was thinking that last year I am not so particular about my kids' academic achievement.  Now, I might focus some of my energies on motivating them to strive more on their studies.  Yes, I help them with their homework but not so much on motivating them to read other materials that will boost their knowledge.

I am planning now to spend 30 minutes more on helping them with their studies.

Now, how about supporting their personal interests?  Hmm. I know they love to play computer games but I am thinking of deviating some of their time with other matters such as sports and other recreation.  I plan to enroll them to swimming lessons and spend time with them playing indoor badminton during winter season and maybe, during summer - basketball or soccer. I need to plan for these activities, too.

4.  Say I love you to my family every day.

I know I say I love you to them often but I just don't know if I say it everyday.  So, I am thinking of saying I love you to them every day.  I can say it when I come from work or before going to sleep when I tuck my kids to bed and whisper it to my hubby when hugging him at bed.  I say I love you to my dad whenever I call him every weekend because he is in another country. (my mom passed away already) I know he needs it because I am his favorite daughter because I am the only daughter. (got you!). I know this helps him be inspired to carry on. So right now, I am saying I love you to them (I need to pause to do that).

5.   Lots of Hugs this year.

Saying I love you coupled with hugs would be something really really important for families.  Touch is an important element in love and life.  So, we need hugs every day.  I will practice more hugging this year.  Hmm... Hug in the morning, in the afternoon and in the evening.  That's a lot of hugs! But you can never run out of hugs, so why not! Besides, there's nothing to lose and more to gain.

6.  Hot Date with my Hubby.

We always spend time together but maybe I am not planning it much. And the time we spend together is while watching tv, lying down on bed and talking about bills and stuff.  Sometimes, I am tired from my work that I neglect him.  I was thinking of having a hot date with him every week (I don't have an idea yet how hot it will be ... but of course, I can make it hotter this year than last year, ha! ha! ha!). This means that the weekend romance will be more special than the weekday romance. Last night, we attended a new year party with the kids. We had so much fun. All the couples sang their love songs and dance their night away. We dance to the rhythm of the rock songs and do sweet dance with the melody of the love songs. Of course, we enjoyed the love songs more because we ran out of breath doing the rock songs (sign of medium age. ha!ha!ha!). Maybe, we can do love songs during our date.

I think these are my goals about my family time this year.  I can add more when I thought of one that I can do.  I did family time first for my goals because they are important to me and maybe the most important in my life. I am inviting you to write your goals for this year.  So, I am wishing you a happy and a blessed new year.  I wish you a fulfilled family life and awesome time with your loved ones.  HAPPY NEW YEAR 2010!