How’s your holiday season going? Hopefully well. How about your finances? Again, hopefully well. If you are already debt-free, then I have some guidance for you on that front. If you are eager to reach that zero balance, this is the article for you.
It’s hard to fully appreciate the finer things in life when you are in debt. Debt creates a cloud of stress and confusion over our daily routine. We feel the effects of debt every time we want to change jobs but can’t take the risk.
Also, we feel debt during the holiday seasons when we want to give our spouse or children something special. Buying Christmas gifts with our credit cards may not be our intention. However, each Christmas is a special time, and we have to make those tough judgment calls.
Wealth is a Mindset
Make the decision. The first part of our debt-free journey is deciding to become debt-free. Do not take this decision lightly. If you think this is a joke, then you’ll stay in debt forever.
Getting out of debt is a lifestyle and will change your views and opinions on many things. My wife and I decided to get out of debt (-$77,000) in January 2019. It took us roughly two years to become debt-free and have an excellent dividend portfolio (+$150,000).
We didn’t get into debt by buying or doing anything stupid. We just had two kids, a house, and suffered through the Great Financial Crisis of 2008. You may be in a similar boat, but now is not the time to concern yourself with how you got here. Let’s get you out of debt.
Why do you want to become debt-free? Your reason will keep you on track throughout this process. There are many reasons that people wish to pay off debt, but yours will keep you on the path.
I like to ask, “What is your rich life?” What place do you dream of taking your family or loved ones on vacation? Do you plan on working or retiring with a nice bit of cash flow? Do you want to be able to spend $5,000 on Christmas presents or travel to see adult children?
Being debt-free is like watching your life in virtual reality—things that used to stress you out no longer register any emotional response. You are debt-free and have a nice cash pile for emergencies. You are firmly in control of your life, not your debt. Work on your reason now before proceeding because I’m going to go deeper next.
Mailbox Money: The Power of Dividends, Rents, and Royalties
What are you willing to do to pay off your debt? Now comes the challenging part—getting started. I am not going to bore you with the standard affair such as lower expenses and stop drinking Starbucks coffee.
You have probably heard and ignored all of those methods before. Nope, I am going to give you the secret to paying off debt—make a boatload of money.
Yep, you will need to increase your income. Sure, you can put in more hours, but that won’t work for long. You’ll burn out, destroy your family life, or hurt your body, mind, and spirit. No, we need a better way to make money.
We need a way to make money while we sleep. We need to build something that makes us money even when we are working, sleeping, or spending time with family. What on Earth can we create that can do all of this for us?
Good Debt vs. Bad Debt
Passive Income. Passive income is the answer to our debt problem. Passive income is something that does not correlate directly to time. We do not exchange time for money.
For example, I can spend 40 hours creating an e-commerce website that sells pdf ebooks. Once the work is complete, this site is now available for the world to shop 24 hours a day. I can make a sale at 2 am or 5 pm. While my shop is running, I can work my day job and hang with family.
Now, what if I opened three more shops selling different types of books? Can you see the power of creating passive income? Your company’s reach starts to compound as you expand your knowledge and business expertise.
It takes money to make money. Sorry, no, it doesn’t. It takes knowledge to make money. I started writing books in January 2021 and made $3 in my first month. In November 2021, I made $96. If I keep writing and releasing books, my income will continue to rise. It costs me very little to produce books.
Do I Need Lots of Money to Start Investing?
Now, I am going to list some things you can do to create income with little money. When you pay little money to start, there are other sacrifices you should prepare to make. Nothing in life comes for free.
A) House hacking. The best way to make an additional income is to rent a room. It is almost free, and you will just need to deal with one tenant. If you have a friend or family member to rent to, this may be an even better solution. The average room rental is probably $700-$900 across middle America. That’s $8,400 – $10,800 annually you can use to pay down debt.
B) Write book reviews. Reading books and reviewing them on your blog will help you gain internet traffic. You can read 100 books in a year if you want. Reviewing obscure or new books on Kindle Unlimited will make you popular quickly.
No Freakin’ Way I Am Working Another 25 Years
C) Write an eBook series. Yes, your first books will suck, but that’s okay. As long as you stick with it, your writing will improve. Writing ebooks in the mystery or romance fiction genres is a license to print money, as long as you keep writing and improving.
D) Run a property management business. There is a severe lack of great property managers, making this profession in high demand. You might need to work for someone to get started and learn the ropes, but you can make a handsome amount of money. You can also work from home and attract clients easily if you run a solid business. Not super passive, but also not overwhelming.
E) Start a passive e-commerce business. A passive e-commerce business is all about affiliate marketing, product reviews, and making great content. You can automate sales, email marketing, and advertising. The barrier to entry is high, but it’s primarily because of knowledge. If you can learn, you can succeed.
Should You Consolidate Debt?
F) Become a content creator. Creating content doesn’t take much money upfront, but it takes dedication. You’ll have to make a promise to yourself to deliver daily content to your audience. If you can do this long enough (2-3 years), then you will have enough cash to pay off your debt. Most people cannot enforce this commitment on themselves—can you?
Conclusion. I wrote an article called “The Core Values of Passive Income: Self-Education, Self-Motivation, Self-Dedication.” You will need to be in complete control of yourself to build an income stream. No, most people do not have the self-disciple to create an income stream.
Reviewing the core values bring us back to the reason you want to become debt-free. That will be your driving force throughout the process of creating an income stream. I have been at it for a year, and there have been many highs and many lows. But in the end, I made $96 in one month from just writing my thoughts.
I printed money from thin air. You can do the same by learning and growing. So, how bad do you want to become debt-free? What are you willing to do to obtain this goal? What kind of Christmas do you want to have next year? Do you want to be straddled in debt, or do you want to have a Merry Debt-Free Christmas?
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Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
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