When you are trying to pay off all your debts, it is often common that you fail to succeed in them because new debts may pile up on top of those you are trying to pay. You may also feel hopeless because the debt amount is too high and you do not know how to pay them completely with your current salary and regular expenses. Even if you use a moneylender’s personal loan to pay off your debt, you may be discouraged to continue because it would take a while before you can truly say you are debt-free.
If you wish to boost your efforts to clear your debts, you need to remind yourself why you want to stop your debts from growing and be free from it. Remember what being free from debt can bring, what restrictions will be removed by being debt-free and others.
If you still cannot think of the reasons why being out of debt is good, here are 9 reasons why you should kickstart your debt-free campaign:
1) It will expand your financial security
Remaining in debt can pose a threat to your financial security and prevent you from maximizing the full value of your cash. The amount you pay your debts could have been used for other things, like emergencies, medical insurance, retirement, and savings.
When you are finally free from debt, you can now ensure that you will be secure for the future.
2) You will have more money for your desires
When you are free from debt, it will leave you extra funds that you can use for your desires which you originally cannot afford. Of course, the number of funds you may get when you are free from debt can vary depending on your salary and regular expenses.
When you only get a small amount of cash from being free from debt, do not immediately purchase the expensive things you want. If you purchase the expensive ones first, you may have to borrow money again to afford it completely. Save the money first then purchase the item you want.
3) It can reduce your stress
Debts are a major cause of stress since you will always think about balancing your debt repayments and your regular expenses. A small amount of stress is ok every once in a while, but if you constantly have stress, it can affect your health greatly.
When you pay off your debts, it can save your life literally since you do not have anything to stress about.
4) It lowers the number of bills you need to pay monthly
The more debts you have, the higher your bills are every month.
When you gain debt freedom, your bills will now be fewer and easier to manage. The only thing you will need to worry about is your actual expenses like utilities, phone bills, and insurance. These expenses do not have minimum payments and interest charges, making them easier to pay.
5) It can boost your credit score
Debt can affect your credit rating, especially if you have a lot of debts that remain unpaid. If you are late in paying even one of these debts, it will also affect your credit rating.
When you pay all your debts and keep it that way, you will be able to improve your credit score.
6) It helps you teach your kids about proper money habits
Financial freedom would also give your children a good example to be debt-free. Explain to your kids why being debt-free is important and why it is beneficial for them to practice good money habits. Of course, you need to make sure you do not look like a hypocrite when you teach this lesson to your kids because an actual proof being debt-free is good.
7) It will help you own the assets you have on loan
If you have an active mortgage, like your house or car, you do not own them completely. If you pay it off completely, you will own the mortgaged item in question. You will no longer have to worry about the bank or the moneylender from getting the item back when you fail to do repayments.
8) It will boost your earnings
When you get yourself a personal loan from a moneylender or charge something with your credit card, you are borrowing cash from your future income. As a result, you are going to pay for the things you borrowed now with the money you will earn the following month and the subsequent months hereafter.
Debts lower a person’s living standards since it restricts how much you can do with the money you currently have. When you pay off your debts, you will be able to maximize your income and improve your living conditions.
9) It frees you from moneylenders and other credit providers
When you have an outstanding debt, it means your money is controlled by the moneylender or the credit provider you used. They will decide how much you need to pay and when you need to pay. In some cases, the moneylender may even increase your interest rate and the minimum amount you need to pay per month if your budget will allow it.
Money is a very delicate possession that every person must handle with care because its value is irreplaceable. If we somehow lose funds, borrowing can be tricky to handle especially if the debts continue to increase.
However, we should not lose hope when it comes to paying off these seemingly endless debts because there is always a way to get past this hurdle. With the 9 points, we listed above, some patience, perseverance and focus, you will be able to pay your debts slowly and free yourself from it.
Imagine how much stuff you can do without worrying about debts! The possibilities are endless so start getting yourself together and begin the long yet steady process of paying your debts today.