My steps to help you achieve financial freedom will not make your money problems go away, but it will help you develop healthy financial habits that you can use to build the future you want. These steps won’t solve your money problem – but they can help you develop healthy habits that set you on the path to financial freedom and all that it means to you.
If you’re specifically looking to eliminate your IRS debt, there’s an IRS debt forgiveness program which many people are unfortunately not even aware of.
Achieving financial freedom can be difficult in the face of increasing debt, liquidity constraints, medical problems or excessive spending, but with discipline and careful planning it is possible. Your chances of financial freedom increase when you save money, control your credit and minimize your debts. Working with the help of a non-profit certified credit counselor to get out of debt is a necessary part of your journey towards financial freedom.
If you want to achieve your goals, you need to have all your income at your disposal, not just the little things left to pay credit cards and student loans. Budget your funds so that you can meet your needs, adhere to a plan to repay your credit cards fully so that you have as little debt as possible and carefully watch your lending. Once you have paid off your double-digit credit card debt, single-digit debt and student loans, split your money between savings, earnings, investment and debt repayment.
Combining your balance with a personal loan can not only simplify the debt repayment process but also lower your interest rate in some cases, saving money today and in the long run. The use of your credit card and monthly payments can help build a good credit history that can lead to additional benefits such as cash, points and travel. Repaying high-interest debt allows you to concentrate on your lower debt and interest rates.
Suppose you are borrowing $4,000 a year in savings to pay off the short-term credit card debt that you have accumulated as a result of poor planning. If you have debt, the interest charges increase your balance, and if you repay money, you lose the money you have saved.
If you have lots of high-interest debt, you can refinance at a lower interest rate to save money. However, high interest-only debt (loans over a thousand dollars) can leave you stuck for years, spending much more to cover interest than saving or investing.
Whether you or someone you know is struggling with debt, the first step to financial freedom is to better understand your debt. What is needed to achieve financial freedom depends on your income, debt, your saving and spending habits, and your values. If you are stuck within these parameters, it can be liberating to leave behind misconceptions of debt and understand how debt can be used to find financial freedom.
This means that it is time to get a grip on debts such as credit cards, student loans and car loans if you have them. When you go through the budgetary phase above, you will understand how much you are putting into your debt and you will discover areas where you can find additional funds to repay your debt faster.