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Debt Free By 40

If You Have Money To Pay Your Debts

Matt and Kayla’s Debt Free Scream! Paid off $92,000 in 40 months.

Try to make an agreement with your priority creditors before you explore any debt solutions.

If you cant make an agreement with them you should still pay them what you can afford, but this might not stop them taking action against you. Check which debts to pay first.

If you have money left after paying your priority debts, you might be able to:

  • set up a debt management plan – this means youll pay off your debts through an independent company

  • apply for an administration order – this means youll pay off your debts through the court

  • set up an individual voluntary arrangement – this means youll pay off your debts through a specialist called an insolvency practitioner

Even if you have money to pay your debts, going bankrupt might be an option for you. To check if bankruptcy is right for you, contact your nearest Citizens Advice.

Save On Groceries To Help Pay Off Debt Faster

To save some money to pay off your debt faster, try stocking up on groceries when they are on sale, or go one step further and stockpile when they are on sale and then skip one grocery shop every month and live off of the food you stockpiled. You can stockpile non-perishable groceries like canned goods, cereal, and things that you can freeze like bread and meat. Filling your cupboards when groceries are on sale and then skipping one grocery shop each month can save you up to 25% on your annual grocery bill. A family of four could possibly save $2,300 to $2,900 a year by doing this. Applying these kinds of savings to your debts, will definitely put you ahead in the long run!

The key to this strategy is watching for sales, only stocking up when groceries are on sale and freezing foods properly. When you skip a grocery shop, you will still need to buy perishable groceries like milk, fruit, and vegetables, but hopefully you can skip the rest of what you would normally buy. If you cant skip a shop once a month, then try for once every other month. That can still save you a fair amount of money. For many more ways to save on groceries, check out these tips.

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Cut The Cost Of Essentials

Cutting your spending takes discipline when it affects your lifestyle. However, there are plenty of savings to be made on regular bills, which wont have any impact on your standard of living.

You should consider:

  • Changing your landline, mobile and broadband packages

  • Ditching TV streaming services that you dont watch

  • Shopping around when your car and home insurance come up for renewal

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Behind The Scenes: What Credit Card Debt Really Costs You

When you want that new top-of-the-line flat-screen TV, its easy to whip out the plastic and figure youll pay it off over time. But when you stop to calculate what that single purchase can cost you if you dont pay it off right away, the numbers could make you think again before you buy. Here are three eye-opening scenarios:

Cost of TV: $5,000 interest rate: 14%

  • Make the minimum payment each month and it will take you 264 months to pay it off. During that time youll pay $5,333.30 in interest, more than doubling the original cost of the TV.
  • Make a fixed monthly payment of $200 and it will take you 30 months to pay if off with $946.23 in interest.
  • Up your monthly payment to $500 and youll have your TV paid off in 11 months and pay only $348.12 in interest.

Of course the best scenario of all is to pay cash to avoid any interest charges. The numbers speak for themselves!

Caution: Once youve finally paid off your credit card debt, keep your guard up! Its way too easy to fall back into bad habits and run up your balances again.

Quitting My Secure And Well

Debt Free at 40 Shirt Boss Man Shirt Boss Woman Shirt Job

Me going back to my well-paid government job in June 2018 was such a shock against my values. Thats why, after many intense discussions with Clinton, I quit from this job. Freedom! But also much, much less money.

In fact, we had lived for 5 years without my salary and we have been fine. We made sacrifices, but in accordance with our values. So we should able to do it long term, but by quitting, we would have no backup if something happened.

Quitting took tons of courage. Going against the current is not easy.

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A Customized Plan For Your Family

If youre debt free, congratulations! Now its time to consider financial planning in you 40s so that youll be more financially secure when you retire. The financial planning you do in your 40s can make for a smooth transition into retirement, providing you with the opportunity to do all the things you want when you retire, as well as providing for your familys security.

Contact us to learn more about how our proven process brings clarity, confidence, and direction to your finances.

Keeping A Simple Life

It is written in the Bible that if your eye is focused, your whole body will be bright. . When we talk about our eye, we talk about our view of things, what we focus on in life.

When we keep our lives as simple as possible, then we are bright because we can focus our time and energy on things that are even more in line with our most important values.

Thats why weve made so many big changes in our lives: so that our lives can more fully fit our most important values. And money is not an important value to us, nor is material goods. Traveling with our little girl that grows up way too fast, thats what we want to invest our time!

Im not saying here that I dont like beautiful things, and when I go to Home Sense, I go crazy and I would like buy everything! But buying too many of these things comes at a cost. And thats a cost we dont want to pay.

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My Partner And I Are Debt

Its not easy, but its possible.

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My wife and I are set to pay off our house this month, after starting down the path of working to become debt-free over 10 years ago. We paid off credit cards, paid off car loans , properly funded our retirement plans and college savings plans for our kids, and lived below our means for a long time. Now were on the cusp of being completely debt-free at the age of 40. Its something were incredibly proud of, given the sacrifices weve made along the way. If youre reading this, you can do it too! We dont make huge salaries. We communicated and shared the same dream. Every raise or bonus along the way would all go toward the mortgage. That was the mindset: Kill the debt! Be debt-free!

Debt does not have to crush your spirit or your life. Congratulations to Jonathan from Ohio for taking the bull by the horns and winning.

Its An Ongoing Process

Alex and Marie’s Debt Free Scream! Paid off $42,663 in 40 months.

Kevin Neoh, Licensed Financial PlannerVKA Wealth Planners Sdn Bhd

I would say both are equally important. Debt management is also part of the key component towards a sound retirement planning, for if we have debts on our shoulders, we can never truly retire as we still have to service the loan when we stop working.

But if one has to take precedence over the other, then it is important to note that usually, our mortgage has a tenure that is as long as our time horizon towards retirement.

If one repays more to reduce the mortgage and to redeem the property from the financier earlier than the tenure stated in the loan agreement, no doubt there will be extra cash in hand and also a property that is free from incumbencies.

However, what happens when the person runs out of retirement fund? Does he have to sell his property then? If yes, where will this person stay after that?

Hence, it is important to prepare for a retirement fund while we are still working, as there is still ample of time before reaching retirement age. In short, just follow your mortgage repayment schedule and save the extra cashflow towards building a retirement fund!

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The Value Of Taking A Break To Review Your Financial Life

If you just paid off a ton of debt, that likely took a lot of work, effort, commitment, and dedication.

It might have taken years of focusing on your debt repayment plan and managing your cash flow to get to this point.

Which is why you need to pause, step back, and give yourself a chance to check out where you are today and the direction you want to head next.

Breaks are good and healthy for us because they allow us the chance to get some space and perspective on what we experience. That perspective is critical when it comes to making decisions about whats next in your life after debt.

Because its true: sometimes more money really does mean more problems. At least in the sense that you now have to make harder decisions because you have more options to choose between.

You might have had other goals when you started paying off debt. Do they still align with what you want for your life now? Its okay to cross of a completed goal and realized things you used to want dont appeal so much anymore.

Paying off debt has an amazing way of allowing you to see your priorities more clearly. You may feel like its time to start a family, or finally take a leap and quit your job to freelance instead.

Or you might find that its finally time to bump your retirement savings up or get serious about financial freedom.

As life changes and time goes on, so do our goals for building wealth. And thats okay.

So What Types Of Debt Are Bad

Thats a great question. Some people dont want to owe anyone anything. To them, all debt is bad, and thats a personal choice.

To others, being a borrower is okay. Maybe you want a home to raise a family in today, and youre willing to build wealth and equity over time as you pay down a mortgage. Thats a personal choice too.

At the end of the day, you have to decide what makes you feel comfortable. Thats what you should work toward, and getting there is more of a choice than you might think.

For example, lets say your beloved 1994 Honda Accord is on its last leg. You and that car have been on more adventures together than you can count. You know youll need a new car at some point, but youre trying not to think about it.

Most of us live with a few problems like that things that feel too painful, scary, or difficult to face. But as we ignore them emotionally, they can often get worse financially.

So a big part of living a debt-free life is planning ahead for the tough things, at least financially, by paying down your debt and building an emergency fund.

That way, instead of getting stuck buying a new car with no down payment and high interest rates, you can choose how much you want to take from your savings account and how much you want to borrow in a car loan when the time comes.

Living a debt-free life puts you back in the drivers seat, no pun intended.

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Dont Let Debt Payments Derail Your Savings

Paying down debt and saving for retirement doesnt have to be an either/or proposition. The two can work together. Once again, you have to prioritize. Heres what I recommend:

  • Save enough in your retirement accounts to capture the entire employer match.
  • Pay off high-interest consumer debt.
  • Create an emergency fund to cover necessary expenses for a minimum of three to six months.
  • Save more for retirement.
  • After that, prioritize other savings and debt reduction goals according to your own situation.

    One Must Realise That Debt

    How Financial Sacrifice Helped Us Become 40 and Debt Free : The ...

    Jyoti is a successful lawyer. However, her childhood was marred by poverty and there was never enough money for anything beyond the basics of food, shelter, clothing and schooling. Now that she is earning well, Jyoti wants to compensate for all that she lost out on while growing up. She wants to enjoy a great lifestyle, with expensive holidays, latest gadgets and car, a home in a posh neighbourhood, all largely financed with loans. She saves a little money every month, but hasnt been able to commit to a disciplined plan to save for her retirement. She is up to her eyeballs in debt. It seems quite baffling to her that some of her colleagues, friends and family live a completely debt-free lifestyle. They save money to buy what they want, have nice houses and cars, and take regular holidays with their families. She wonders how they do it.debit cardsavings. Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)

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    Create A Budget You Can Stick With

    Budgeting is crucial if youre trying to push toward debt-free living. By deciding where your income should go before you get it, you can use it to knock down those debt payments and eventually pad your savings.

    Once you work out your plan, set up your monthly payments automatically so you dont miss any due dates. Here are some common budgeting techniques to get you started:

    Reasons To Go Into Retirement Debt Free

    Im a firm believer in getting out of debt. Heck, I even paid my house off before my 30th birthday!

    Let me just tell you, life after debt is amazing, and I recommend it to everyone that reaches out and asks about it. I dont care if youre young, old, rich, poor, male, female, democrat, or republican, life will be better if you ditch your debt.

    Why? There are 7 solid reasons.

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    The Average Debt For Those 45

    It seems that household debt levels start to decline for householders between 45 and 54. The average debt for debtors in this age bracket is $177,030. Its probably not a coincidence that the average salary for those in that age bracket is the highest for any age bracket. Additionally, the average mortgage debt on a primary residence for this group is $204,320.

    Tips For Managing Debt

    Dip Into My 401(k) to Pay Off My $25,000 Credit Card Debt?
    • Including debt in your overall financial is very important, and a financial advisor can help with that. Finding a qualified financial advisor doesnt have to be hard. SmartAssets free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If youre ready to find an advisor who can help you achieve your financial goals, get started now.
    • When you have multiple loans and are trying to figure out how best to tackle them, you should usually prioritize paying them off in order of highest interest rate to lowest. The higher an interest rate you are paying on a loan the more expensive it in in the long term. So as a rule of thumb, it makes sense to prioritize debt from over student loan debt and then student loans over mortgages.
    • Even as youre prioritizing certain debts, make sure to always pay the minimum monthly payment on all your loans. This will ensure you dont face any late payment penalties, further adding to your debt.

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    Increase Your Debt Repayments

    Hopefully, once youve followed all these steps, you will be feeling more in control of your finances. You should know exactly how much you owe, how much money you have coming in and, with luck, your outgoings are lower.

    That means you should be ready to start focusing on your debts and using the money you have freed up to repay them.

    Pay off as much as you can each month. Not only will this speed up your debt repayment, but it will also save you money in interest too. Whatever you do, dont fall into the trap of rewarding yourself with a big spending spree.

    Setting up debt repayments by direct debit can make sticking to your plan easier.

    Say No To Impulse Shopping

    Thinking before you purchase can potentially save you a lot of money. You should try to find deals that let you save the most and think about whether you actually need the item or not before you make the purchase. With a bit of practice, it is possible to learn to enjoy your life without spending a lot of money. If you are genuinely committed to it, You should write down a budget on paper and set rules for yourself.

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