Baby Step 0: Make A Decision To Change
Before you even get into the 7 Baby Steps, I think it’s important to start out by talking about just how key it is that you sit down, talk with your significant other, and actually make a decision that you want to change.
A lot of people talk about how to change, but never touch on the fact that if you or your spouse isn’t ready to change, it isn’t going to happen. You have to want to change.
I know for my wife and I there wasn’t one moment where we decided that we wanted to change, it was just a gradual realization that we weren’t spending our money as wisely as we should, that we were accepting too much debt as a part of our financial plan, and that we craved the freedom of not carrying any kind of debt. We wanted to be free!
Getting to the point where you want to change might mean that you’ve hit bottom and declared bankruptcy, or it might just mean that you’re sick of not saving enough towards retirement. It’s a different point for everyone. But when you get there you’ll know.
No More Debt
Once you’ve made a decision to change, you need to be able to begin the change immediately and make a decision as a family that you aren’t going to incur any more consumer debt. Credit cards and home equity lines of credit are off limits now. No more high interest auto loans! If you want a new TV or a new kitchen countertops, you’re going to have to save for them. No more store credit cards to buy clothing at ridiculous interest rates!
Cut up your credit cards, and draw a line in the sand. No more debt!
My wife and I used to use our credit cards in a variety of ways. We would use them to pay for vacations because we wouldn’t plan ahead and save up for them in advance. We’d use them as a safety net for our household, instead of saving up a cash emergency fund. If we needed new furniture we would just finance it at the store, and pay it off over time. Once we made a decision to change, we realized that we couldn’t do that any more. We had to make a life change. Using the 7 Baby Steps we were able to make a change in the way we looked at money, and in the process change our lives for the better.
Prepare Yourself
When you’re starting on the road to financial freedom you need to brace yourself and realize that it isn’t always going to be easy getting out of debt and building wealth. There will be bumps along the road, and there will be times that you’ll want to quit. Your family and friends may even think you’re a bit odd for all the “strange things” you’re doing – like not using credit cards, not incurring debts to buy nice cars or not upgrading your house. You’ll seem abnormal, but that’s ok. Normal is being broke. Being debt free and financially sound IS strange. So you want to be strange.
Make a commitment today to simplify, and get started on the road to financial freedom!