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9 Powerful Questions That Will Change Your Financial Life

9 Powerful Questions That Will Change Your Financial Life

You’ve probably heard it said that to get to the “right” information, you have to ask the correct question. Makes sense, but when it comes to money, what exactly are the questions?

No matter what the current state of your relationship with the green stuff, there are nine questions that will empower you to be a more secure, confident, self-aware master of your financial fate. Revisit them often to re-tool and update your goals and keep your outlook grounded:

1. What is the role of money in my life?

Money is a tool. For many people, however, there is so much emotion tied up in having money, or the lack thereof, that all aspects of financial life are laden with emotion and fraught with tension. It is extremely difficult to make calm, rational, clear decisions when emotionally saturated, and wealth management is no different.

Before you tackle any other questions, first ask yourself – what role does money play in my life? How much time do you spend thinking about it? Worrying about it? Dreaming about it? When you have thoughts about money, are they tense, frustrated, disappointed thoughts; how do you feel? Do you dread making that monthly budget?

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Write it all down in a notebook or on a scrap of paper, and notice how your physical body reacts to your thoughts about money by tensing or relaxing. Commit to noticing how you feel, and working toward being as relaxed and neutral as possible each and every time you think about money.

2. What did my role models teach me about money?

You’ve learned attitudes about everything from politics to personal hygiene from those who raised you, and your attitude about money has also been heavily shaped by those who cared for you during formative years. While you can, and likely will, develop your own approach as you mature, your immediate response to stressful or new situations will be drenched in “what my parents thought.”

Take some time to identify their attitudes so you know on what foundation yours are built – how important was or is money to them? Did they talk about money openly and easily, or is it something secretive? Did they offer an attitude of abundance and gratitude for what they had, or were they constantly seeking more?

3. To what degree does money control my happiness?

Money may not be able to buy happiness outright, but it sure can buy a lot of things that contribute to happiness and well-being. There is always more than can be had, however, and in our modern technologically connected world, it is easy to become acutely aware of what we lack.

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Do you wake up with a smile, independent of your financial status? Do you have faith in your ability to work your way out of, and be delivered from, financial troubles? Can you appreciate a gift that is of low monetary value? Are you comfortable giving gifts of low monetary value, if that is what you have to give? Can you enjoy a date arranged on a budget, or a shoe-string vacation, or does everything have to be “five star” for you to have fun? If you lost your job, would you still be able to define yourself?

If your answers lead you to conclude that money is a vital part of your happiness and sense of self, commit some time to figuring out who and what you are, without the dollar signs. You can appreciate and enjoy money and all that you can experience with it without having your financial status become a core part of your identity.

4. How do I react to financial stress, disappointment, or fear?

No matter how much money you have, or don’t have, there will be events that cause you to experience financial stress. There will also be disappointing times when you take a gamble that doesn’t pan out, or when you fear for your ability to provide for a child’s education or an aging parent’s medical needs.

During these times, does your stress take over your life? Do you lash out; do you sabotage what you already have? Or, do you take a deep breath and develop a plan to acquire more resources, get back on track, or whatever action is required? If you are in need of new ways to cope, try turning off the television and avoiding advertisements, all of which compete to rearrange your priorities. Consider your answers to the previous point – what and who are you without money?

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5. Do I know what I want?

Once your basic needs of food, shelter, water, and so on are met, what are you earning money for? Be specific about both your current needs – do you want to own a car? Do you dream of being able to provide for a family when it’s time to have one?  Do you reasonably anticipate needs such as children or parental care?  Do you want to share your home with pets?  Are there places on the globe you want to trot around?  Would you enjoy daily life more with more leisure time or if you had more funds for a favorite hobby?

There is no point in earning money simply to earn it – you can’t take it with you when you kick the bucket. So why, exactly, are you earning it?

6. If not, what am I doing to determine what I desire?

You may not have ever paused to think about why you care about money and what you are saving for, and that is entirely understandable. If you don’t know what you want, acknowledge that fact and dedicate time and energy to figuring it out, at what point will you be able to sigh, relax, and say “I have more than enough?”  What does life look and feel like at that point?  Write it down if you need to, or create a vision board.

7. If so, do I expend resources in a way that is aligned with what I desire?

If you are able to clearly and specifically articulate what you desire and believe will transpire when you reach a certain financial point, to what degree are your resources of time and energy aligned with that financial goal? If you are working toward an ambition, are you spending the money you have today in a way that will help you reach that goal?

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If, for example, you want to own your own business, do you know what your financial launch point is? Are you spending time educating and preparing yourself to leave the conventional work force? Or are you watching a lot of television, spending money on expensive nights out, and daydreaming more than taking action?

8. Do I know how to budget, plan, strategize, and get to what I desire?

Once you have identified what, exactly, you want, be honest with yourself about how much you do or do not know about how to get there. There are many ways to budget, invest, save, spend, and handle money as there are stars in the sky, and there is always something to be learned about financial management.  Do you know what it will take to reach your financial goal?  If not, what are you doing to better inform and prepare yourself? Are you seeking out mentors, studying online, spending time conducting research in the library, scouting out online forums, attending classes?  There is a way to get to your desired end point, you just have to figure it out.

9. How much, and in what ways, do I give?

Finally, what good are you doing in this world? If you are able to contribute financially to a cause or to help others, are you doing so in a way that reflects your values, morals, and personal areas of interest? If you are not able to contribute financially to a cause, are you sharing your time or wisdom? It’s not all about money, and it’s not all about you; your satisfaction with the human experience will increase exponentially when you give to others.

Craving more?  Check out these 12 Things You Can Do Now To Improve Your Financial Life.

Featured photo credit: Dollars via flickr.com

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Published on January 8, 2021

How To Pay Off Credit Card Debt Fast: 7 Powerful Tips

How To Pay Off Credit Card Debt Fast: 7 Powerful Tips

Ever wondered whether your credit card debt is the reason you’re in a bad financial situation? You can’t enjoy any fun activities because a good chunk of your money goes toward debt payment. Heck, you’re even behind on some of your monthly bills.

The effects of clumsy debt management are too many to list here. This guide is going to help you discover how to pay off credit card debt fast and start chasing your financial goals.

Debt problems are the last thing anyone wants to encounter. But things can get out of hand when all the “little debts” you take accumulate in interests.

What if you knew some simple and proven ways to be debt-free quickly? Implementing them would mean better financial health for you. It becomes possible to free up cash for your “wants.” These include taking a trip or buying something you’ve always desired. All that while paying your bills on time!

Let’s not wait any longer. Here are 7 powerful tips for paying off credit card debt fast:

1. Pay More Than the Minimum Credit Card Payments

Many people only pay the monthly minimum on their credit cards. Truly, that’s the right amount for staying on good terms with your credit card company. But you need a different approach if you’re looking to achieve financial independence within a short time.[1]

Most of your payments go toward interest costs when you only pay the minimum amount. A substantial sum of your balance remains standing. As a result, it becomes more expensive to eliminate your debts.

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You don’t want to wait more than 10 years to get rid of debt while it’s possible to do it sooner. All you have to do is double that $100 minimum payment to $200 or go higher.

The good thing is that minimum credit card payments are affordable in most cases. By paying a higher amount, you reduce your interest costs, lessen your borrowing period, and boost your credit score.

2. Start With High-Interest Credit Card Debt

If you have more than one credit card debt, prioritize putting the extra money toward the ones with the highest interests. This debt pay-off strategy, known as the debt avalanche method, is essential for being debt-free quickly.[2]

First, you need to list down all the credit card debts you have in the order of their interest rates. Next, you choose the one with the highest interest and pay a significant amount toward it each month. It can be an amount twice or even thrice larger than the minimum payment.

At the same time, you make monthly minimum payments on the other debts. Their interest charges won’t be as costly as that of the first debt on your list. You only move on to the next high-interest debt after the first one is gone. Remember that your focus is on the interest rates and not the balances.

3. Revisit Your Budget

Budgeting is useful for tracking your financial moves. Once you create a budget, some tweaks along the way can make it work for you better. One situation that requires you to revisit your budget is when you’re struggling with debts. It might hurt a bit to slash some expenses. But you also don’t want to miss out on achieving financial freedom in the long run.

You can reduce some variable expenses to free up more cash for credit card debt payments. They’re the ones that change from time to time. Some examples are groceries, fuel, and clothing.

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Other opportunities for cutting down your spending lie in non-essential expenses. Instead of dining out all the time, you can cook at home more to save money. You can also share some subscriptions with friends and pay a fraction of the cost.

If you’re determined enough, you can eliminate all your unnecessary expenses and focus on paying off your credit card debt first.

4. Avoid Using Your Credit Cards

Do you want to know how to pay off credit card debt with a low income? One simple way is to stop using them. Having your credit cards everywhere you go means that you’ll be more tempted to buy unnecessary stuff. In this case, you spend money that you don’t really own and get deeper into debt.

The quickest fix to stop the debt build-up is spending with cash. You’ll be more aware of everything you can afford at any particular time. If you decide to keep one or two cards to ease the transition, always make wise choices. For instance, only use them when experiencing financial difficulties.

It’s best to categorize your fun activities under “discretionary spending” in your budget. This way, you won’t need more debt to kill your boredom. By halting your credit debt from accumulating, it’s easy to pay down what you already owe and be happy with the progress.

5. Start a Side Hustle to Boost Your Income

You’re probably turning away a lot of money by not monetizing your skills. Everyone has something that they’re good at doing. And you can use that to generate extra income for attacking your credit card debt.

If you look around your neighborhood, you can find several side hustle opportunities. It can be pet sitting, tutoring, or lawn mowing. You can start an online business by offering services such as digital marketing, content creation, and web development. Such skills go in high demand on freelance sites and job boards.

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Finding clients on social media is also a good strategy to utilize your skills and make more money. Facebook groups, Quora Spaces, and subreddits are some places to look for side jobs. You only have to join a niche-specific platform, share your services, and respond to any opportunities.

It’s possible to learn a skill, practice it, and earn from it. Use the free resources online or purchase some e-courses to get started.

6. Sell Your Used Items for Extra Cash

Starting a side hustle isn’t the only way to generate extra money. You can turn unwanted items into cash for paying off credit card debt. Whether it’s an old TV, book, or furniture, there is always someone itching to buy your used stuff.

A garage sale, as much as it’s old-fashioned, is perfect for getting your neighbors and passers-by to buy from you. You keep all the money because there are no business permits or taxes involved. While you may not make much cash, it’s better than leaving your stuff to go defunct in your storage.

Other than that, you can sell your used stuff on online marketplaces. Facebook groups are great places to start if you want quick approvals and hence sales. You only have to ensure that your listing follows Facebook’s commerce policies.

When selling any pre-owned items online, ensure they’re in good shape to avoid problems with your buyers.

7. Know When to Seek Help With Your Debt

Asking for help with your credit card debt can be challenging to do. But letting it drown you is a road you don’t want to take. While you may feel embarrassed at first, it’s the best way to get back on track when you run out of options.

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There are tons of non-profit credit counseling organizations that can offer you free guidance on how to escape the debt trap. An example is The National Foundation for Credit Counseling. They simply review your finances and help you determine the source of your financial problems. After that, they match you with an actionable debt management solution.[3]

In extreme cases, the debt solution can be:

  • Debt relief – where your debt is partially or wholly forgiven
  • Debt consolidation – taking out one loan to repay others
  • Debt settlement – the creditor forgives a significant portion of your debt
  • Bankruptcy – legal process for seeking relief from some or all your debts

It’s necessary to carefully weigh your options before deciding on the way to go. Find out how it might affect your credit score and any other risks.

Wrapping It Up

Debt is a major setback when you’re trying to prosper in life. Paying off credit card debt is essential if you want to reach your financial goals. That means having more free income, a good credit card score, and even a chance to retire early. You become more productive each day because of the peace in your mind.

So, you now have some tips on how to pay off credit fast. Go ahead and get rid of that good life progress killer!

More Tips on How to Pay Off Debt

Featured photo credit: rupixen.com via unsplash.com

Reference

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