Get Out of Debt Bondage By Saving Money

A number of studies recently conducted on Americans have showed that 1 in 2 believe that they wouldn't be able to maintain their current standard of living if the country enters a recession. This is a result of a country where the typical citizen lives beyond their means. In fact, in the United States, living beyond ones means has become an acceptable form of behavior. Unfortunately, this type of financial mindset not only leads to less wealth over the long term, but when it is practiced on a large scale, it can actually cause a country to enter an economic decline.

If you wish to build wealth, you must accept the fact that saving money "will always" be more powerful than borrowing it. The average American owes between $9,000 to $15,000, and this is only on credit cards. This doesn't include student loans, car loans, mortgages, business loans, and all the other forms of debt that Americans carry. Being in debt for large amounts of money simply means that you're a slave, a 21st century slave. The slavery that you're under is no different from the physical slavery that was practiced in previous centuries, and is still practiced in some countries today. The only difference is that instead of physical chains being placed on you, economic chains have been placed around your neck.

If you don't believe what I just said in the last paragraph, think of it this way. The per capital income in the United States is $43,444 as of this writing. Since the average American owes between $9,000 and $15,000, this means that a large amount of their annual income must go towards paying off these credit cards, and the amounts listed above don't even include the interest which credit card companies charge. Once you recognize the fact that the average American pays 14% interest on your credit card, you start to see why $43,444 doesn't sound like a lot, especially when you have food, shelter, and energy to pay for, expenses which are skyrocketing in price. No wonder the United States is practically in a recession!

1. To get out of debt bondage, and live a life of financial freedom, the first thing you will have to do is get out of debt fast, and reject the debt/credit based lifestyle. You must make the decision that you will stop using all forms of credit for the rest of your life. If you currently carry credit cards in your wallet or purse with large balances on them, the first thing you must due is cut them up and toss them in the trash. Of course, you will need to continue making payments on them, but by destroying them outright, you can be certain that you will never again be able to use them, and you will be forced to use cash.

2. The next thing you will need to do is "reduce your standard of living temporarily so you can get out of debt faster." You may not like what I just said, but if you want to live a life of financial freedom like I'm doing, you will need to listen to what I'm telling you. While this doesn't mean that you should live in a cave, or live uncomfortably, you will need to make drastic changes. For example,  If you're living in an apartment which is taking up 40% of your monthly income or more, you will need to make plans to move into a smaller apartment that is cheaper, but is still within a safe neighborhood.

The excess money you save by making this move should be applied towards your monthly credit card payment. If you can save an extra $250 per month by moving into a cheaper apartment, this is $250 more per month that you can put towards paying off your credit card. If you put $250 per month towards paying off your credit card, in 12 months, just from this one money saving move, you would have paid down your card by $3,000.

3. The next thing you will need to do is dramatically reduce the number of times that you're eating out each month, and the amount you spend when you do eat out. Eating out is far more expensive than most people recognize. For example, if you eat out 17 times a month, and you spend an average of $6, by the end of the month, you would have paid $102, just on eating out, and this doesn't include the amount you spend of groceries! If you want to save more money so that you can pay off your debt faster, eat out less and eat at home more. Buying food at a grocery store is always cheaper than eating out because you're not paying for the convenience of having the food prepared for you.

4. You will also want to begin getting rid of unnecessary bills you don't need. For example, if you're paying for cable, cancel it and either use the Internet, or read books as an alternative. Get rid of any additional phone services you don't need, or reduce your phone bill altogether. While getting out of debt won't be easy, doing it quickly will bring you more wealth over the long term.