Saturday, August 10, 2013

How To Get To Zero-Debt As Fast As Possible

I love retelling my experience in Grade Four.

A few classmates of mine started wearing long khaki pants for their uniform.  

Suddenly, they looked so mature, so grown up, so guwapo–while all of us who wore khaki shorts were so totoy.  

So I asked Mom to buy me a pair of long pants.  But she kept on saying, “Let’s save for it, Bo.” 

The following year, I was in Grade Five, I was the only one wearing shorts.  It was humiliating. 

And in Grade Six, I was the only guy wearing a bikini.  That’s what my classmates called my shorts as I had already outgrown them….

Believe me, I have never again been so sexy in my life.

Finally, on graduation day, I wept with pure joy when Mom gave me my very own pair of pants.  Oh, I didn’t care that the hemline at the bottom was extra heavy—because it had six folds. (When I asked my mother why, she said, “So that I can adjust it as you get taller.”)  To me, they were the most beautiful pair of long pants in the world.

But ironically, after a while, the thrill faded away.  Because I wanted to wear jeans.

“Mom, everyone has at least one pair!” I pleaded.

When she bought me one, I soared to cloud nine and romped off with it like a prince.  I thought my happiness would never end, until I went to my classmates to show off my jeans.

“Our jeans are Levi’s,” one of them told me, “What’s yours?”  I didn’t know.  So he looked at the label of my jeans and read it out loud for all to hear, “Yours is Ludy’s…”

But to this day, Ludy’s has been a symbol of my happy lifestyle.

       In fact, people ask me, “Why do you have so few desires in your life now?”  The answer comes from my bikini experience: I’ve realized that all human desire never quits on you.  We just keep on wanting more and more stuff.  Nothing ever satisfies.

Never believe your desires when it says, “After this, I’ll be satisfied.”

Do you have debt right now?  Get rid of it.  The Bible says, Those who borrow are slaves of moneylenders. (Proverbs 22:7)

If you want to get to Zero-Debt as quickly as possible, you need to have the Ludy’s attitude too.

Never Borrow To Buy Deteriorating Stuff

       If you want to get out of debt, the first step is to STOP borrowing for anything that deteriorates in value.
Just to let you know, I use my credit cards for convenience—so I don’t carry a lot of cash.  But I don’t borrow from it.  That means at the end of the month, I pay the entire amount.

Do you have something you want to buy right now and are tempted to buy it on credit?  Don’t.  Save up for it every month.  Tame your I-Want-It-Now monster.  See what happens to your desire after a few months of saving.  You might wake up to realize you don’t really need it.

Debt Freedom, Anyone?

       List down all your debts, from those with the highest interest down to the lowest interest.  If you have huge credit card debts or if you used loan sharks that charge usurious interest rates, a stop-gap measure is to ask around for “cheaper” loans that charge lower interest and transfer your loans there. I repeat: This is just a temporary solution.  At the end of the day, you want to wipe out all your debts.

       Even as you’re trying to pay off your higher interest loans, try to pay the lower ones with the minimum amount.  By giving your creditors even a few hundred pesos a month, you’re telling them that you’re not running away.  In fact, call them up and tell them you’re working at your finances.

       I’ll say it again: Save as much as you can from your current expenses and pour it all in your debts.

Do you dream of ever reaching the state of zero-debt?   Fire up this dream!  Make a payment scheme plan and calculate when you will reach zero-debt.  Print this date—month and year—with big letters in your journal.  Have faith and stick to your plan.

May your dreams come true,

Bo Sanchez

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