Get Out of Debt, Part 3: Thinking Rich

Mountain vista

« Read Get Out of Debt, Part 1: Stop the Bleeding
« Read Get Out of Debt, Part 2: Grab the Bull by the Horns

It’s very easy to add up everything you owe, figure out how long it will take you to pay it off, and get extremely discouraged.

That’s why it’s important to focus on the things you’re doing to get out of debt and not on the debt itself.

The Snowball Effect

As you work your plan to cut expenses, manage your debt, and increase your income, something amazing will happen. You’ll gain momentum. And speed. You’ll start paying your debt off faster and faster until suddenly, you find yourself out of debt and saving massive amounts of cash.

You can thank the universe for this. The universe loves momentum; just look at these catchphrases:

  • It takes money to make money
  • The rich grow richer
  • Success breeds more success

That’s the universe at work. All these ideas say the same thing; if you start down a path, that’s the path you’re on. It’s like practice makes perfect. The more you do something, the better you get at it. And with a 3 point plan (expenses, debt, income), you’ll get very good, very quickly.

Once the snowball effect kicks in, your thinking will start to change. You’ll start to think rich. And once that happens, there’s no stopping you.

Thinking Rich

In a horror movie, the biggest tension doesn’t come after the monster jumps out and attacks the heroine. It comes before we know what to expect. Or when to expect it. The biggest tension sits in the quiet dark corridor before we ever see the monster.

Debt happens the same way. It’s the monsters we can’t see yet that cause us the most tension.

For example, if you’re worried your beat-up old car will break down and leave you stranded somewhere; that tension is worse than the tension of going into debt to buy a new one that’s reliable. It’s easier to take on the debt because that’s a monster you can see.

But if you can buy a brand new car tomorrow, debt free, that tension doesn’t exist. And the chances are excellent that if you have the money, you have better things to do with it, like investing it.

Suddenly you don’t need a new car.

That’s the essence of thinking rich. As you make progress paying off your debts, not making those payments will cause you more tension than the thought of your beat-up old car breaking down. And when you start saving and investing your money, not doing that will cause you more tension than the things that might happen.

You know you can buy a new car when you need to. Just knowing that, slays the monster. Knowing is everything.

Now you know.

6 thoughts on “Get Out of Debt, Part 3: Thinking Rich”

  1. I think a lot of times Shane, people allow themselves to believe that their debt has gotten so out of control that they will never be able to manage it. Which in most cases just isn’t true. Yes it takes a while, sometimes years to clear your debt, but the task is not so unattainable as one might think.

    Good posts all three of them.

    Take care and cheers mate.

  2. Hi Robin,

    I think the numbers can be overwhelming. The worst number to look at is ‘how long’ you think it’ll take to pay it all off. This number prevents a lot of people from even getting started.

    I found that it doesn’t take as long as you think it will. I’ve had a couple friends go throught the same experience and every time I see the same things … it never takes as long as you first think it will, and once your thinking starts to change and the snowball effect kicks in, it gets easier and easier.

  3. I’ve always thought HAVING the new car would lead to my happiness. But as any consumption, buying the car only made me want a faster, nicer, more expensive car.

    I just had to realize I would be better off knowing I could purchase the car if I wanted it than actually putting myself $30k in to debt realizing the car.

    Thanks for the post 😀

  4. Scott,

    I’ll let you in on a little secret … the car analogy is a personal one …

    I still drive the same old VW Jetta I drove when I was in debt. When I really couldn’t afford a new car, I almost bought one many times. The process of getting out of debt and making some serious coin made that “want” go away.

    My thinking changed.

    These days, my friends still laugh at my car (it’s a great source of humor!). But I’m laughing all the way to the bank 😉

  5. Blah to debt and college loans 🙁 I totally agree with you Shane. I’m all about investing money…I’m not a heavy spender at all. I also really liked the catchphrases you used in the post. Great examples 😀


  6. Gregg,

    That’s good. It’s easy to spend money on stuff we really don’t need. One thing I always try to remember is that we are not our things.

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