How To Get Out Of Debt (2d. Ed.): Simple Wealth Hacks, #1

By Christine Esser

GET OUT OF DEBT NOW 

If you are worried about your debts, and you are ready to take action to get out of debt, this book can help you. It offers a simple plan to follow to increase your income and reduce your expenses. You create the plan. You set the pace to go as quickly or as slowly as you want to eliminate your debts.  

 

 

• Language: English
• Publisher: Christine Esser
• Release date: Oct 9, 2023
• ISBN: 9798223250067

Christine Esser

Author Christine Esser writes nonfiction books about money and historical fiction books where the characters face money issues. My cat, Zeus, the fastest rubber ball retriever in the West, encourages me in these efforts. 

Book preview

Introduction

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"If you know how to spend less than you get, you have the philosopher's stone."

– Benjamin Franklin

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The philosopher’s stone is a mythical substance that was capable of turning base metals, such as mercury, into gold. What I believe Benjamin Franklin meant when he wrote, If you spend less than you earn, you have the philosopher’s stone is that if you consistently spend less money than you earn, and you use the money you save to invest in income-generating assets that are likely to increase in value over time, you are likely to become wealthy, or at least you are likely to never be completely broke. It is the conscious decision to build a gap between our income and our expenses and how we use the money in that gap that determines whether we become wealthy or we remain poor.

But wealth need not be your immediate goal for getting out of debt. Your immediate goal might be to survive a recent financial setback, such as a job loss or extremely diminished earnings. This book is for you as well.

My hope is that this book will do more than pay for itself. You should be able to find at least one tip here that will help you recover the modest cost of this book and if you find several that you implement, it can change your financial trajectory from lack to wealth.

If you eliminate the interest on at least one debt payment, that is almost certain to exceed the cost of this book. And if you implement any of the tips to live a debt free life and build the future of your dreams, you will have improved your life. 

That is why I wrote this book. But this book was not written only for you.

I am using these strategies to eliminate debt that I incurred after the recent COVID pandemic. I incurred credit card debt to buy food when cash was in short supply. (I freely admit this book is a work in progress and I am not a financial guru. Nor am I a millionaire. I am a person with credit card debt, rental housing debt (businesses closed here which left no income to pay rent and I fell behind), and student loan debt, who is in the process of paying it all off - just like you. And I’ve been down this road before, so I know what works. 

So just like most of you, I was impacted by the recent COVID pandemic. I am grateful to have survived the pandemic when so many did not, but it has left me with debt that I need to eliminate. I have had to cut back on spending extensively. This book will outline some methods I use to save money.

Additionally, I have added tips that do not apply to my particular situation that other people have shared with me that are helping them to get out of debt or save money. Thus, this book is intended to help anyone who seeks financial recovery and is willing to not incur any new debt. But getting out of debt will take less time if you are willing to cut back expenses,  increase your income, or preferably, do both.

I make no judgments about your current financial situation. If you want to beat yourself up, I suggest that you stop, but I will not join in making you feel bad about yourself.

Instead, I assume you made the best decisions you knew how to make given your circumstances, the information you had available, and your skill set. And all of us benefit when we learn more knowledge and deploy more effective strategies and skills.

But the first step in correcting any problem is to acknowledge that the problem exists. So, if you are currently in debt, you must acknowledge you have a debt problem and you must be willing to ethically do whatever it takes to solve it.

If you want to become wealthy, you can use at least some of the money you save by eliminating debt to invest in financial assets that add money to your net worth. But that topic is not covered extensively in this book. (If you are interested in this topic, consider my book, Get Rich From Nothing - Ben Franklin’s Formula.) 

Also, everyone’s financial situation is different. Some of us thrive on budgets, some do not. If you find budgeting helpful, do that. If not, then do not prepare full budgets.

But I will ask you to track your spending for at least one month because so many of us are in debt because we lacked clarity about how much money was coming in, when it was arriving, and from where it originated (if your income is from gig work), and just as importantly, how much and where the money is being spent. Even if you decide a budget is not for you, you will still need to mentally track how much you are earning, and how much you pay out monthly so that you do not overspend.

I hope you find many financial tips in this book that you will want to use. But I recognize many of the tips suggested will not apply to your specific circumstances. I have included them here because they might apply to someone else’s situation.

Some of my suggestions might even cause you to question my sanity. That is fine. But try to keep an open mind. I do not advocate for anyone to go dumpster diving, but bartering, buying used items at thrift stores or other places, seeking discounts, minimalism, and frugality are all virtues to my current way of thinking.

This book was made for a US audience because that is my location. Some tips will be universal, others may not apply if you live outside the United States.

So please think of this book as a giant smorgasbord. I hope you find some items attractive and helpful, but others may not be suitable for your situation. Skip over any tips that are not appropriate for you and focus on the information you can use to get out of debt.

Most importantly, be kind to yourself as you learn to battle debt and change your financial circumstances. The math part is simple but changing behavior can be very stressful, at least at first.  

Change is often difficult. Adjusting to living on less money usually presents us with a challenge. Developing the discipline needed to earn another income stream if that is what it takes to get out of debt can be draining. Changing the way we  think, and more importantly, changing our behavior with money, is a learning process.

Try to achieve as many small wins as you can at a pace you can maintain. The most important new habit you can develop as you get out of debt is to consistently spend less money than you earn over a long period of time. 

Even a small decrease in your spending habits over time can make an enormous difference. For example, suppose you currently use a local bank for your checking account, and you spend twelve dollars every month for the monthly bank fee. That twelve dollar monthly expense charge can become an asset of $811.01 over five years if instead of paying the bank fee, you move your money to an online bank that does not charge the fee, and you place your twelve dollar monthly payment into an index fund that compounds annually at about five percent. In fifty years, your twelve dollar monthly investment can become an asset of $30, 283. 72, if invested at five percent interest.  

But if you need the convenience of having a bank nearby, can you make electronic deposits to not pay the monthly fee? Look at your bank statement if you are paying a monthly fee and determine whether there is anything you can do to stop paying it. (As I write this in 2023, a few banks are failing. Check the  strength of the bank before you deposit any money at a bank or other type of financial institution. Although the deposits in most US banks are covered by federal insurance, it could take a while before you recover any money deposited if a bank fails.) 

This is an example of one small monetary change that people can make that will have an impact on their finances over time. Find a bunch