Investing Made Easy

Did you know that investing is really easy? Robert Kiyosaki, author of the famous book: Rich Dad, Poor Dad, has this theory that the best way to get out of poverty is to be in the quadrant of either a Business Owner (B) or an Investor (I).

I have been an employee for the past 27 years. It was rewarding financially, but it wasn't the kind of reward you want to end up when you retire. So, I decided to try investing in the stock market. My intention was to see how my money can work for me. Ultimately, I am investing in the stock market to gain experience and prove that it is better than putting my money in the bank. The return on investment (ROI) is better.

5 Things to Never Keep In Your Wallet

I used to think that I need to keep all stuffs in my wallet. Credit cards, ATM cards or Debit Cards, Driver's License, SSS card, etc. I am now of the opinion that it is better to have them all in my wallet just in case I need them, I have access to them right away. Right? Wrong!

Yes, I have realized that if I lost my wallet containing all these important stuff, I am in big trouble. Imagine calling all the credit card companies and canceling the cards to protect it from the thieves? That's just one problem. What about my SSS number? If thieves can access it, they can apply for a credit card in your name and make costly purchases in your name! Whoaaa!!!

How To Save Money Every Month

I just can't let this article pass us by. So I am re-posting it here. Here's some practical ways we can save on money monthly. I love what Moneymaking's idea to stop bringing your credit card for a month. I feel this is a real challenge to all of us. There's a false security in bringing our credit card with us, in our wallets, isn't it. We often tell and even convince ourselves that we might need it, "just in case". So we end up using it. If there is a supply, we usually create the need.

Well, here's what I want to focus on: what activities should we do. My friend from Fiji, Savenaca, always tells me, "No more theories, theories. Just do it!" So here goes:

1. Stop bringing your credit card. At first, you will feel very restricted but you will slowly realize where you are spending money on. It’s amazing that we remember our purchases so much better when we pay in cash.

Doing The Right Thing

I am happy with what I am doing. As I often say, sometimes we fail in managing our finance because we fail to monitor our expenses.

The starting point in budgeting our financial resources is to find out how and where your money is going. I am doing an experiment on my finances. To find out if I am within my set budget, I am taking note of all my financial transaction and recording them in a simple Excel file.

I am excited to see how it goes. So far so good, meaning, I am faithful and consistent with my recording.

See you on my next report.

Have a blessed life ahead of you.
Jimmy

Areas of My Finances I Need To Review

I was hit with two, yes two costly bank charges because of insufficient fund. I felt bad, really bad, because it's really a simple matter but I missed it. The charges cost me a lot. The money could have been used to put petrol on my car for 2 weeks. Whoaaaa!

How did I addressed of this problem? First, I immediately went to my bank and enrolled my checking account to their "back up plan" where they will take money on my savings account to fund my checking account if their is insufficiency. I should have done this a long time ago!

Do You Manage YOU?

This is true. I always tell my students in our Work Ethics And Values Seminar at Uno Overseas Placement that they are running a business whether they like it or not. And that business is their LIFE.

Looking at my own life, I think I can honestly say I am having an exciting but hard time to make my "business" a  profitable one.

When I read this article from someone I admire, I was encouraged by Dave Ramsey when he wrote this wonderful and practical article entitled: "You Inc: Manage Your Money Like A CEO". He knows what it is to be in debt and how to get out of it as well.

You will certainly appreciate his ideas and it will help you start a good habit of managing your money well. So, here it is for you.

"If you managed money for ‘You, Incorporated’ the way you manage money for you now, would You hire you?"

Top 3 Free Budgeting Tools For You

You want to be serious about making your financial house in order but don't know where to start. Well, here's a starting point for you. Find out what's happening to your finances, Take an inventory of where every cents go by listing all expenses you do daily for a month. Categorize the expenses by type e.g. Food, Gas, Utilities, etc. Tally.

The result will give you an idea how to set your budget for each category. Budget is very important. It gives you a parameter of how and when you can spend your money. It helps you to be disciplined in the use of your hard-earned money.

5 Tools For Teaching Your Kids How To Save

I love this article by Carol J. Alexander at the Christian Personal Finance. I would like to post it here to guide you, if you're a parent. You will benefit a lot if you try to use it on your kids. I have seen some of her ideas worked on my children. Now they're all professionals and saving is part of their finances. You must teach them while they're young. 

5 Tools For Teaching Your Kids To Save Money

All children are different. My six children may all look the same on the outside, but on the inside they all march to the beat of a different drum. I have naturally hard workers, and I have those we trained to work. I have a son who breathes music, and I have another son that needed his music lessons.

Likewise, I have a few who squirrel away every penny they get and a few whose pennies slip right between their fingers. Yet as a parent, you want to do your best to train your children to have positive character qualities—and saving money is one of them. Here are 5 tools for teaching your kids to save money.

What We Say Matters

Its been hectic these last few weeks. What can big debt do to a person? More specifically, how do you deal with at least four banks running after you and collecting from you huge amount of money?

For a simple guy like us, that means a lot of worry and anxiety. My blood pressure would probably rise due to tensions running high. Sleepless nights. No appetite for food. These are just some of the consequences of debt, which are due and collectible.

During these times of crisis, people blur out words that are not helpful to solving the problem. Words are very important. What we say, the words that come out of our mouth, are like the "steering wheel" of cars or the "rudder" of big ship that can steer that thing to the direction the driver wants to take it.

Most often, during this times of crisis we say words that have negative effects like "there's no more hope", "I am going to jail for this", or "there's no more solution" to this problem. You know what a person believes by what comes out of his or her mouth.

Proverbs 21:18 says "Death and life are in the power of the tongue. An they that love it shall eat the fruit thereof." In other words, what comes out of our mouth determines life or death. If we choose negative words, you shall eat it and it will happen.

Choose to say what you want to see happen in my life. Because your tongue, what I you say, is the steering wheel of your life!

So if you want to get out of debt, even huge debts, the solution doesn't start from your bank accounts, or from your friends, and relatives' help. It starts from your mouth. What you say is the steering wheel of your life. You say what you want to see happen to your debts. Try it, it works.

To yours and my debt-free life,
Jimmy

Budgeting For The Starters

I had a wonderful time with my eldest daughter, Rache, just before she left for a vacation in China. One of the things we talked about was how she will have money ready every time an opportunity to travel presents itself to her. She has realized that she must be serious in her finances from that time on. I am an advocate of having a family budget. I have been telling her to have a budget of her own so she can manage her finances well. I think that small talk we had will change the way she values her money. I have a guest post here about starting to make a budget. It's simple you can easily do it. I am proud of Rache. She will be a millionaire someday if not soon. Here's a guest post from Financially Poor:

Budgeting: For The Just Getting Started

So you have come to the realization that you need to control your finances. Well I’m here to help you get started. Starting a budget is somewhat easy but there are a few steps that can trip you up. What I’m going to do is walk you through the mine field so you can have a budget that you can call your own.

Starting out

What your first step needs to be is make a list of categories of bills that you have every month like rent or mortgage, phone bill, etc.  Here’s what mine looks like:

The reason to list those first is so when you decide how much goes into each category you can get the necessary bills out of the way first and know how much you have left over for the rest of the categories.

Next make a list of all of your monthly variable expenses like this:

If you want to make the categories more detailed go for it. You can make eating out into breakfast lunch and dinner if you want. Customize it to whatever works for you. Don’t worry about making it perfect the first time around though. Budgets tend to evolve over time so just make a first one that will get the ball rolling. The Spouse 1 and Spouse 2 is for fun money for each person FYI. Be sure when you put the two groups together that you add a line for savings between them.

Divvying Up Your Money

After you’re done making categories for your spending it’s time to find out your spending. This step is to find out how much money you spend in each category. There’s a few different ways to do this.

One way is to guesstimate how much you spend in each category. Your regularly monthly bills will be pretty accurate but your variable spending will probably be pretty off. With this method you’ll be adjusting your budget a lot and can be frustrating so I wouldn’t recommend it for most people.

The other way is to track your spending for a few months and fill in the categories with those amounts. If you have a debit card I would use that because then you can see your transactions online and it’s so much easier to keep track of. If you don’t have a card and you just use cash then think about getting a small note pad and writing your purchases down. This isn’t the most fun step but it is the most eye opening experience. When you actually see how much you spend a month you may be very surprised.

At the end of each month put all of your purchases in their different categories. This will give you an idea about how much you spend in each category. Now comes the meat and potatoes part. The point of a budget is to control your money instead of letting it control you. So this is where you decide how much you want to cut back on variable spending. I’d recommend you cut back slowly so that it’s not a big shock and turns you off. If you spent $300 on entertainment try to cut back to $250. If you cut back a lot you might get frustrated that you can’t stay within budget and could cause you to give up. so each month just cut back a little more and eventually you’ll figure out where a comfortable level is for that category.

Once you figured out your budget write it down on a piece of paper or put it in a spread sheet. I write down my budget in a notebook so I can carry it around wherever I want to and work on it. I have mine set up like this:

Another reason I write in a notebook is because I fill out, on the page after my budget, columns with the different variable spending categories and amount budgeted. Then through the month I write down the expenses as they occur in the correct category. This helps me save a lot of time.

That’s pretty much it. Not hard at all. Over time your budget will be customized to your situation. What you just created is a gateway to a better financial life.  This is a tool that’s going to help you get control over your finances.

How was your experience setting up your first budget?

I hope you have made one budget for yourself and your family. 

To your debt-free life,

Jimmy

Does Cruise Control Save Gas And Money?

This is a rejoinder to my earlier article about saving money of gas. This article is written by John Frainee on the Christian PF. As I was reading it, it sounds doable. I often do cruise control on my way to and from work along Commonwealth Avenue. As you know that road is too wide and has slopes of more than 5 kilometers going down.

I would like to post this here for our benefit. Here goes.

I’ve been called by some a “grandpa” on the road. They mean to say that most grandpas are old men, and that most old men drive slowly. Well, I’m not sure that’s a logical argument, but I admit that I do drive slower than most.

Today I’d like to make the case that “driving slowly” (aka, going the speed limit) and using cruise control can actually save you money.

How Using Cruise Control Saves You Money

1. Cruise control helps you avoid the need for acceleration.

Whenever you accelerate, you’re using gas. When you’re using gas, you’re losing money. Turning on cruise control will help you avoid the craving to hit the gas when your favorite dubstep song hits the radio.

2. Cruise control will help you maintain a constanteconomical speed.

According to the US Department of Energy, gas mileage usually decreases rapidly at speeds above 60 mph:

        You can assume that each 5 mph you drive over 60 mph is like paying an additional   $0.28 per gallon for gas.

Yikes. That’s quite an increase in price to get to your destination a bit faster. If you’re the kind of person who complains

3. Cruise control, set at the speed limit, will help you avoid tickets.

I’ve never received a ticket (I guess “grandpas” don’t get tickets, ha). But for those of you who have, I’ve heard it isn’t a pleasant experience.

Tickets are expensive. Many states are over $100 per ticket. It’s not uncommon to see a $300 ticket. Ouch. That’ll put a dent in your 7 Baby Steps.

4. Cruise control results in less maintenance costs.

Taking corners fast is damaging to tires and overall hard on your vehicle. Cruise control gives you a constant speed and helps you avoid accelerations that give your engine more work to do.

When To Use Cruise Control

The natural answer is as much as possible. Here are a few places I use cruise control:

The Highway or Freeway

On long stretches of road cruise control comes in handy. Typically you want to go the same speed on the freeway and don’t have to worry about speeding up or slowing down (unless you live in Los Angeles).

Low Traffic Areas

There is a certain amount of hesitation factor when it comes to turning off your cruise control. Make sure that if you turn on your cruise control you also have the ability to turn it off quickly in the event you have to change speeds. The last thing you want to do is rear-end someone because you forgot which button to push.

On my Honda, there are three ways to turn off cruise control:

1.    I can push the master cruise control button.

2.    I can push the accelerate and decelerate buttons simultaneously.

3.    I can tap my brakes.

Now, I’m not one to make decisions quickly. If you give me several different ways to do one task I freeze up. This is exactly what happens when I have to choose a method to end my cruise control session. Therefore, I realized that I had to decide beforehand which method I would use to quickly bring the vehicle out of cruise control. Now I push the master cruise control button.

You can generally avoid this panic by using cruise control in very low traffic areas. Ensure you keep good distance between you and the car in front of you, and you’ll be just fine.

How Do You Save Money on the Road?

Using cruise control is just one idea that can save you money. Do you have any other vehicle tips you could share in the comments section below that save you money?

I used to see my brother-in-law driving too slow on Commonwealth Avenue in Quezon City. I keep on wondering why? Then I found out that he was using cruise control to save on gas. This may sound unbelievable but I tried it and it helps me save on gas.

To your debt-free life,

Jimmy

Photo

Save Money on Gas Tip

I have learned something new last week. Gas is a big part of my expense since I use my car (Corolla GLi) in all my travels. I am thankful for that car, a 1994 model, which I faithfully keep on top condition, thanks to my friend Chief Ruel of Exalta Car shop in Banawe, Quezon City.

Now back to my discovery. Usually when I fill my car with gas, I just let the gas attendant fill it up the way the used to do. They press on the "automatic" mode and let the pump to its work.

I learned that when they do that, the gas pumps the gasoline and the "air" together so I get less gasoline in effect.

My dear friend, Adel, shared with me that I can save money on my gasoline expenses by asking the gas attendant  to fill my car using the "pure" way or "Puro" in tagalog. The next time I went to my gas station, I asked the attendant to fill it pure. I noticed that they press the pump slowly and taking their time doing it.

What they are doing was making sure that no air or less air is mixed to the gasoline. To better imagine what I am saying, when I fill my car with a P1,000 gasoline, the "automatic" way takes less that 2 minutes. But when I request to fill my car the "pure" way, it takes them some 5 minutes to fill the same amount of gasoline.

As a result, I save money with more mileage added to my car somewhere in the vicinity of 20 kilometers.

Why not try it yourself and see how much you can save. Surely the savings will help you reduce your debts.

Here's to our debt-free life,

Jimmy

Photo credit:
http://www.gettyimages.com/detail/photo/man-holding-petrol-pump-nozzle-in-high-res-stock-photography/BB1111-001http://www.flickr.com/photos/rmgimages/4882451256/sizes/m/in/photostream/

To Love It Or Love It Not

I would like to post this very good article on the love of money by Dave Ramsey. He says that our view of money is important if we plan to get out of debt. How we spend our money is directly related to our perspective of money. So here goes "Love It Or Love It Not" by Dave Ramsey:

A lot of people love Benjamin Franklin.

Oh, come on. Admit it. You're probably pretty fond of Benjamin Franklin, too. He's the guy on the front of the $100 bill, and you're not going to say you don't love $100 bills, are you?

If we're honest, most of us love money. Actually, we love money we don't have. How else can you explain our addiction to credit cards? Our culture loves money so much that we have television shows dedicated to showing off people's million-dollar houses and garages full of luxury cars!

Every day, we see thousands of ads that promote the dollar as the end-all-be-all ticket to a happy life. But we know better than that...don't we?

Wait a minute, you say. Doesn't Dave Ramsey talk about building wealth all the time? He sure does. But Dave is talking about a healthy view of money. The foundation of Dave's ideas of wealth building are that you get out of debt and build wealth so you can help your family and others … and leave a legacy after you're gone.

It's also okay to want to make a lot of money and to enjoy spending it! But what's the end goal? Is it to own stuff, or is it to help others and to change your family tree?

A lot of us have an unhealthy view of money. The Bible says that "the love of money is a root of all kinds of evil." It's that type of "love" that drives us to buy stuff with money we don't have to impress people we don't like.

For some people, the "love" of money is more like an obsession or an addiction. It can drive a wedge between spouses and teach kids that stuff is more important than anything else. It can lead to divorce and broken families. When we talk about changing your family tree, that's not what we have in mind!

Think of money as a tool. You can use it to help yourself and others, or you can use it to tear all of that down. You can use it to save for your kids' college fund, help your church or favorite charity, or you can use it to buy a bunch of stuff that will be collecting dust two years from now.

A healthy love of money will drive you to get gazelle intense about working through the Baby Steps and getting out of debt. It will motivate you to make better decisions with your money—decisions that involve only spending on needs, not wants. You will view life through a new lens, a lens that puts your future and the well-being of your loved ones first. Don't let money and stuff run your life.

There's no need to obsess over Benjamin Franklin. Plenty of other people will do that. With Valentine's Day just a few days away, remember who and what is important in your life, and keep that in perspective this year.

Thousands of other people are on their way to making better decisions with money this year. With hundreds of Financial Peace University classes starting across the country, now’s the perfect time to join them on the road to Financial Peace!

A healthy perspective of money will help you spend it wisely and sets you up to a debt-free life.

To your debt-free life,

Jimmy


Photo credit

The Battle Against Unbearable Debt

How can one win over unbearable debt? This is a big question I keep asking myself when I hear our overseas workers' financial struggles. Even before leaving for work abroad, they are already in deep debt but there's this nagging hope that their problem will soon be over.


Guess what? After working for 3 years, most come back with nothing and the worst part is they are still in debt.


Benjamin Pimentel's article on How overseas Filipinos can win the battle against unbearable utang (debt) clearly explains the reason why many of our OFWs end up deeper in debt compared to their goal  of eliminating debt, which is the very reason why they leave to work overseas.


I would like to cite a portion of his article that I believe is the key to getting out of this unbearable debt:

"OFWs should and must undergo financial literacy to protect and harness their money which is more often lost and squandered," he said.

Let's affirm a key premise here: Overseas Filipinos perform a vital role by sending money back home to help their families. But there¿s also a growing need for families to find better ways to manage funds coming from abroad.

And we're not talking about totally avoiding debt. In many cases, as I've noted, debt is necessary to meet a need.

But there's such a thing as smart debt and dumb debt. Worse, there is unbearable utang - debt that becomes so overwhelming that overseas Filipinos end up wearing themselves out as they find themselves trapped in a vicious cycle.

Charito Basa, an OFW advocate based in Europe, listed four general principles for overseas Filipinos and their families (which actually applies to everyone in this time of crisis):

Have a budget and stick it to it no matter what

There'll be special requests from family and friends that will tempt migrants to deviate from their budget," she says. Be firm. People will eventually understand that they are doing it for the good of everyone."

Save first, before spending (not the other way around)

Set aside a fixed amount for savings. Charito recommends at least 10 percent of one's income. She and Tony Ranque point to the tested formula for sound personal finance management: Income minus Savings equals Expenses.

Saving a portion of your income is a must, not an option," Tony says. If you cannot develop the habit of savings which is founded on discipline, force yourself to save by getting pension plans and other types of pre-need plans."

Have insurance (health, education, retirement, pensions)

When done through reputable companies, insurance plans can guarantee that needs are attended professionally and that funds are available when most needed," says Charito.

Stay away from "get-rich-quick" schemes

This rule also applies to everyone.

My experience tells me that most of our OFWs are not financially literate. This, I believe, is the main reason why they end up poorer that when they first left for work abroad. They just can't find time to educate themselves in money matters because they are too busy running after the money.

The painful reality is when their contract is finished, in a few months, they're broke again or you see them lining up to apply for work abroad again.

So, how can our OFW win over this unbearable debt? Maybe you have a better suggestion we can all use. 

To our debt-free life,

Jimmy

Photo credit

Use That Card Wisely

I have two kinds of card:  a credit card and a debit card. Both are from the same bank. I use my debit card for the following:
1, Grocery purchases
2. Shopping (on purpose) like when we bought a new gas stove the other day
3. Medicine purchases
4. Books and school supplies

On the other hand, I use my credit card for the following:
1, Representation Expenses (chargeable to my company)
2. Gasoline, when I have no cash on hand and I need to load
3. Planned eat-out with family and also friends (on purpose to get credit but paid immediately)

From my experience, I get into trouble when I use my credit card on unplanned purchases. Come pay time, I miss it since I have no budget for it.

I came across this article that suggests of 3 ways to use a credit card. A great help indeed.

The best option for me is to plan and budget and really stick to it. Doing so helps you get out of DEBT!

To our debt-free life,
Jimmy

Saving For My Birthday

This is my year. I promised myself that I will celebrate my birthday with a party in May. This will be my "first" birthday party. Looking back, I can't remember a time in my life that I celebrated my birthdays with a party.

First on my list is to save for this big event. Every centavo saved counts from now until May. I feel it is an exciting time for me.

But why spend if you can save the money? Yes, I've thought of that. Frugality dictates that I don't spend my hard-earned savings.

However, for this special event in my life, I would like to share the fruit of my labor with my friends and loved ones. It's "once-in-my-life-event" that I believe, I should do.

So this early, I am believing God for the blessing on my savings and provision to honor Him on my 60th birthday on May 18.

Come celebrate with me,
Jimmy

P.S. By the way, saving to buy an item on cash basis is a good habit that will definitely get you out of debt.

Photo credit

7 Worthy Resolutions To Commit To In 2012

Hi there. I have been away for a while. Japan is now in winter season. Visited our Filipino workers around Takamatsu in Kagawa-ken. It has been a fruitful monitoring. Just by seeing them and being where they work, brings joy and refreshing to these precious people.

Together with the industrious lady welders in Takamatsu

At the highest point in Tsuda, Kagawa-ken

With the lady Chicken Choppers

On my way back home last January 17 on PR 407, I was reading an article on the Philippine Star. This particular article caught my attention because it speaks to retirees, of which I am within its zone!

Took this photo at the Kansai Airport on arrival

But I believe the resolutions mentioned by AP can be applied to younger ones too. The author mentioned Seven (7) resolutions for retirees in 2012.

Although I can go on retirement mode, I made a conscious decision not to retire yet because I feel that my best days are still ahead of me. There's no time to stop doing what I am called to do.

Now, let me give you my take on this article.

First of the resolutions mentioned is the call to get disciplined about money matters. The best way to do this is to set up a formal budget and stick to it. Being thrifty without a plan only goes so far when unexpected expenses arise, especially at an age when health care costs can start to mount. How true this is.

Attack your debt. The top priority is to pay off credit card debt. After the card is zeroed out, use only one card and pay off the balance monthly. If an emergency expense leads to a balance, don't let it linger or it will erode retirement savings. Having only one credit card is a very practical suggestion indeed.

The other resolutions include:
1. Invest in dividends-paying stocks
2. Get your estate plan in order
3. Be more generous
4. Check into long-term care insurance possibilities

The last one is especial to me: Stretch your body and mind. The author says we need to choose daily pursuits that keep you physically, mentally and socially engaged. Physical activity helps us to live longer, feel better, depression free and keeps our mental skills sharp. I take physical exercise as a necessity for my body that's why I play badminton and brisk walk at least three times a week.

I can't help but notice the mental sharpness of Justice Cuevas and Senator Enrile in the current impeachment trial of CJ Corona. They are in their 80s yet they are still sharp as ever. This is also the main reason why I blog!

What about you? Do you feel you can use these resolutions for 2012?

To our debt-free life,
Jimmy

GET OUT OF DEBT: 6 STEPS YOU NEED TO TAKE

The New Year is full of hope and excitement. Many are looking forward to a bright year ahead. This includes goals like having a new car, promotion at work, increase income, better relationships, better house, and probably more travels. The list goes on. 

For me, I have decided that I will look for ways to increase my earning capacity for two reasons: to speed up the process of paying my debts and to celebrate my birthday in May, my first since I can remember! I want to save towards that meaningful event of my life when I turn 60. What A blessing!

I am posting this article by MMarquit entitled "Get Out Of Debt: 6 Steps You Need To Take" (Coupon Shoebox). The thing that really cool about this article is it's simple and easy to do. My wife and I start our year by revisiting our last year's budget and making changes to arrive at our 2012 budget. Part of that process is listing all of our debts as suggested in item no. 3.

I know it will be of great help to you as you do what MMarquit says. Cheers and Happy New year!

One of the most important financial lessons that you can learn is that debt is prison. Indeed, when you are paying interest on your debt, that money is going straight into someone else’s bank account — and you receive nothing in return. Plus, paying that interest makes it harder to pay down the principal and to reduce your debt. Even though it might be difficult to get out of debt, it is doable. Here are the steps you can take to get out of debt.

1. Really Decide That You’re Getting Out Of Debt

The first thing you have to do is decide that you are really committed to getting out of debt. You need to truly want to change the way you do things, and get serious about paying down your debt and getting on the path to financial freedom. Without the commitment to get out of debt, you are likely to give up.

2. Stop Adding To Your Debt

Take a look at your budget, and figure out how you can better live within your means. Before you can effective tackle your debt problems, you need to stop making purchases with debt. Look at your spending, and cut back on the unnecessary items so that you are living within your means.

3. List All Of Your Debt

Next, list all of your debts. List the balances, minimum payments and interest rates. Decide on an order to pay them off. Many people like the “debt snowball” method. You take that lowest balance debt, and concentrate on that first. This method is psychologically rewarding, since you see success faster, and are encouraged to keep going. Others, though, prefer to start with the debt with the highest interest rate, since it will save more money in the long run, since you will get rid of the most expensive debt faster.

4. Decide How Much You Can Put Toward Debt Pay Down

Now that you have prioritized your debt list, it’s time to figure out how much money you can put toward your debt pay down. Honestly evaluate your spending, and look for places to cut back. You should be able to find waste in your spending, and, instead of spending it on frivolities, put it toward paying off your debt. Pay the current minimum on all of your debts, except the one at the top of your list. Put your debt pay down amount toward that debt. The more you can put toward it, the better.

5. Look For Ways To Earn More To Speed Up The Process

If you want to speed up your debt repayment process, you can look for ways to earn more money. Start a side hustle. Get a part-time job. It’s only for a little while. If you can put your debt repayment efforts into overdrive, you can be free that much sooner — and you will reap the benefits.

6. Acknowledge Your Successes

You can stay motivated when you acknowledge your successes and take time to reward yourself. Don’t go big though — you want to stay out of debt. But you can hold a little celebration, or you can retire each debt in a creative way. Buy a small treat, or cook your favorite dinner at home. Be sure to mark each milestone, and get excited about your next step toward success.

Looking forward to 2012, debt-free,

Jimmy

P.S. Last year, I decided to start blogging in my desire to create a new stream of income. However, as I learn how to blog, I found that beyond making money, I can express my passion and help others find answers to their problems and challenges. Today, I am grateful to my mentor, Jomar Hilario, for teaching me how to blog and hopefully to be like him someday. If you are interested in blogging, why don't you join me at Online Mentoring Club.

Photo Credit: http://www.gettyimages.com/detail/photo/files-with-labels-royalty-free-image/92347801