6 Ways to Change Your Mindset about Debt

Debt — especially credit card debt — can be a crushing reality that’s hard to get out from under. The average American household carrying credit debt owes nearly $16,000, and every month, those households’ cash flow — and therefore, their options regarding how to spend, how to save, and the like — are limited. Many people believe that making more money is the first step in getting out of debt, and while some debt is driven by having too little cash, a lot of credit card debt is related to values, attitude, world view, habits, and other aspects of life that have nothing at all to do with how much money you make on a month to month basis. If you’re in debt and you want to get out, you need to change your mind. You need to focus on controlling the money you have and finding ways to make more. It’s all about saving and making money. Here are six subtle shifts in thinking that can help you right your sinking financial ship and start working toward financial responsibility.

Before you go on, if you want to take a moment to learn how I paid off over $50,000 in credit card debt, then it might be helpful as I made many of the below shifts in order to succeed.

1. Self-Empowerment

For many people, facing down a mountain of debt can completely pummel self-esteem. How in the world are you supposed to tackle it at all, let alone pay it off? If you feel overwhelmed just thinking about your debt, it’s time to practice self-empowerment. Read stories about real people who have overcome debt problems that are worse than yours. Download smartphone apps that can assist in money management. Take a course on finances. Meet with a debt relief counselor. In any way you can, build up your confidence and resources. Only if you feel self-empowered will you be able to look your debt squarely in the face and conquer it.

2. Sticking to Plans

If you’ve made plans to get out of debt before, and you’ve failed, it’s time to bite off something you can actually chew. Sticking to the plans you make regarding your debt isn’t just essential to paying it off; it’s essential to starting the process at all. Assess yourself honestly: Are you ready to make a plan and stick to it? Being very austere may look like the fastest path to a debt-free life, but if you can’t stick to an extreme budget, you’ll only extend your debt trouble longer. Sticking to your plan is more important than the plan, so make one you can work within over the long-haul.

Which way should you pay off debt? Which plan is the best? That’s entirely up to you. Pick what works and go with it. You can always change your plan as you learn more about yourself and the process. Learn more about the two most popular debt payoff plans: the debt snowball and debt avalanche.

3. Intrinsic Valuing

There tends to be two ways a person can judge themselves: Either he/she values themselves intrinsically in a way unrelated to status, wealth, and the like, or he/she values oneself based on extrinsic markers like status and wealth. For many people who struggle with debt, a shift in how they view themselves needs to occur. If you struggle to see judge yourself apart from spending and accumulating, your extrinsically placed personal identity is helping to fuel your debt woes. Make a change. Start seeing yourself as a person with inherent value that has nothing to do with what you own.

4. Positivity

It can be hard to stay positive in the face of financial hardship, but doing so can have a large impact on your ability to get out of debt. There’s no need to minimize your problems, but try looking at them as learning opportunities instead of obstacles. Doing so will provide your attitude a needed boost that can help energize your efforts at paying down your debt.

Related: How the scarcity mindset keeps you in debt

5. Make It a Game

Do you have a competitive streak? Let it out, and let it at your debt. Many people have paid down their debt successfully by turning their troubles with money into a game. Set reachable goals for yourself, and build rewards into meeting them. See your debt as your opponent, and every time you pay down $100 or $1000, celebrate it the way you would a soccer goal in a big game — just make sure you do it in a financially responsible way. Some good ways are a dinner out (paid with cash) or a day trip to a museum to break up the monotony of paying off debt. It can be a long road to debt freedom, so make sure you reward yourself in some way. It’s all about motivation people!

6. Delayed Gratification

One of the most attitudes to overcome when you’re trying to successfully emerge from a debt mire is delayed gratification. Within the U.S., the presence of easy credit has fostered a demand for everything now. Many people assume that instant gratification is the only gratification that exists, but by choosing to delay it in favor of waiting until you have the money is an option as well. Relearn the lost art of patience, and paying down debt — and staying out of it — will become much easier for you.

For some people, debt becomes a lifelong struggle that colors every purchase and decision. However, by making these small shifts in thinking, you can pay off the debt you’re currently in and avoid getting into it in the future.

Do You Know Your Credit Score?

Even if you don’t plan on getting a loan, a good credit score can affect your ability to get a job, a place to live, and will save you money whenever you need to borrow. If you don’t know your credit score, you can get yours free at Credit Sesame. It’s 100% free with no credit card required to signup. I’ve been using it for years to monitor my credit score.

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