Paying Off Debt_1: One of the Keys to Prosperity and Happiness
Paying off debt_1 has been the priority for sometime now so we are almost ready to do some investing that will take the long road from debt to wealth. But first, let's review how one family got rid of these obligations that helped them along to this point.
They followed all the rules in this business of paying off debt_1. How did they do it? At the start it was difficult. They wanted to throw the bills into the incinerator or put them in file G for garbage, but they won't go away. They kept coming back, month after month so they decided to face it head-on.
First, they talked to the companies that owned them because of their debt. They asked for a reduction of interest because at this point they were paying a loan-shark type of interest, I mean in double digit. They told the creditors their family found themselves in dire strait due to circumstances beyond their control. Then they asked for a repayment schedule after the reduction of the interest rate was granted.
Much to their surprise they got what they wanted. It was yes for the reduction of interest and yes for a repayment of schedule. So they took a calendar and mapped out a schedule of payment. They made sure they put the date when each payment was due. They didn't want to miss any paying off debt_1 payment as that would raise their interest rate.
Then they gathered up all the items in the house that they no longer needed and had a big garage sale. Believe it or not, that got them over $300. Instead of celebrating and blowing that money into painting the town red, they decided to add that to their minimum payment due. This gave them the momentum they needed and they had another family meeting.
Their sixteen-year old daughter said she would work at MacDonald and contribute half of her pay towards the family finances. The fourteen-year old boy shined shoes. And their baby who never even had a chore before, mowed lawns. Both boys contributed half of their earnings into the family coffer. Boy! Were the parents proud of their kids.
At work, the father signed up for double duty and that added more income. Even his wife scoured the internet for how they could have a home-based business and found one she could live with. It was hard going and she had to do a lot of writing but before the renewal arrived she earned enough for the cost of the hosting fees.
They emptied their savings account and put that into paying off the debt_1. They looked through their insurance policies and found they could borrow money there at a very low interest. Guess where that money went. The father did the same thing from his 401K which gave him a loan at such a low rate.
The next thing on the block was their home equity. Should they get a low-interest loan to speed up the process of paying off debt_1? After considering the pros and cons, they decided they did not need to do this. They will leave this when the children go to college or when they start their investment project.
The whole family was having fun doing this, the father thought he should have put himself deeper in the hole. Not! Anyway, they just loved looking at the board where they put up the progress of their debt reduction effort. It was fun looking at that figure going down fast. They didn't know it could be such fun to be paying off debt_1.
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