Have you ever dreamed about what life would be like if you didn’t have any debt? Becoming debt free doesn’t have to be just a dream. It can be your reality and a new way of life if that’s what you really want.

Here are four important questions for anyone who’s interested in tackling their debt.

Question #1: How did you get into debt?

Is your debt a result of a one-time situation such as a divorce, illness, education costs, or job loss that you have not yet recovered from?

Did you accumulate debt through the normal course of life such as paying for college, buying a home, financing a vehicle, etc.?

Does your debt exist primarily because of consumer mentality or overspending?

The way your debt came into existence should impact the way you approach paying off that debt. For example, debt that was accumulated through a “one-time” situation creates a sudden influx of debt, but with the proper plan, that debt can be systematically eliminated over time. On the other hand, debt caused by consumption or overspending must be approached a little differently. Overspending is often an ongoing dynamic which requires addressing the behavior behind the overspending first, so that the debt doesn’t continue to increase. Once the spending is under control, then you can develop a plan for eliminating the debt that has already accumulated.

Understanding how your debt came into existence also helps you understand what changes or adjustments you will need to make to be successful.

Question #2: What are you currently working with?

One of the reasons people shy away from tackling debt is that it seems too overwhelming, but it’s hard to truly assess it before completely pulling the curtain back on your financial situation.

Pulling the curtain back includes:

1) Knowing exactly how much debt you currently have?

2) Knowing exactly how much money you have left from your paycheck after all your bills are paid?

The answers to these questions will help you estimate how long it might take you to pay off your debt, understand whether you will need some additional income, or whether you can get it done simply by cutting back some expenses. Overall, knowing the details of your situation will help you understand how much work you need to put in to reach your goal.

Question #3: What are you willing to do without?

You will likely have to sacrifice some things, at least temporarily, in exchange for getting rid of your debt. How much you’re willing to sacrifice directly affects how long the journey will take. The more things you can do to shorten your journey the greater your chances of success.

Sacrifice doesn’t only apply to spending; it also applies to time. In addition to foregoing some of the things you enjoy, you might also need to designate some time toward generating extra income. This means sacrificing some of your watching television time, talking on the phone time, or hanging out with friends time, so that you can work more hours.

Question #4: What’s your motivation for getting out of debt?

I consider this the most important question of all. The reason it’s most important is because after you develop a plan for becoming debt free and commit to making the necessary sacrifices, you still must follow through. This is where your “why” kicks in. Your true reason for wanting to be debt free is what ultimately motivates you to finish.

If you’re not quite sure why you want to be debt free, I encourage you to write down all the things that would be different about your life if you were debt free. Write down all the ways things would be better for you and your family if your were debt free. Having your reasons down on paper makes it more tangible and readily accessible to look at on a regular basis.

Your motivation will be the fuel that keeps your motor running when you get tired. Your motivation will be the thing to pull you back from the ledge when tempted to do something that could potentially ruin all your hard work.

Additional Resources:

Would you like to connect with a community of people who are committed to living their financial dreams? The Different Money Different Life Community is a place where people who are serious about improving their finances come together to network, encourage one another, and celebrate victories together. This is a free community to join, membership is subject to approval.

Are you looking for a blueprint for how to become debt free? My book Want to Live Debt Free? This is How Do It lays out the necessary strategy for paying off all your debts quickly and efficiently. The book is full of practical applications, tips, and chronological steps for successfully paying off all your debt much faster than you think.

Are you looking for a simple money management system that doesn’t require you to be a personal finance nerd to operate? 10-Day Money Makeover is a commonsense money management system that allows you get your finances under control and put them on autopilot. 

Are you looking for a financial coach or financial planner to help you let you out a financial plan tailored just for you? I’m a Certified Financial Planner and Tax Professional with over 10 years of experience helping people put together easy to follow plans designed to get them where they desire to be. Schedule your free consultation today!