It was 2007 when I was debt free, have an investment and property. Then in 2008 during the great recession, I have to bail out one of my family members. It was a mistake on my part. To make the story short, I had acquired a condo. For about a year, I had no renters. I was paying the mortgage and condo maintenance fee from my credit cards. My investment shrank significantly. I’m bleeding cash every month. My debt ballooned to 300k. I was stress and went to a depression. Suicidal thoughts ran through my head. My wife blamed me for it and it was entirely my fault. She backed me up through it and the years to come. I have to make a drastic plan. I remember from the book Rich Dad Poor Dad, Robert Kiyosaki’s advise, there are two ways to reach financially free, Increase the Income and Decrease the expense. These were my guiding principle to tackle the issue.
Here are my 7 steps
- Eliminate the biggest Debt – I offload the condo in a discount and pay the mortgage fees, lawyers, and etc..
- Consolidate Credit Cards – I would have filed for bankruptcy but I will lose my own house. This was the option at that time.
- Cut Expenses – I cut my cable, phones, insurance, and entertainment
- Live Frugally – Less eating outside, less entertainment, less travel, staycation.
- Get a part-time job – I took a part-time security job.
- Increase Business Income – I had been building my side business. It helps me pay for expenses such as food and gas.
- Get a raise – It helps pay the debt faster.
I’m now debt free and a positive 300k. I’m also now running multiple streams of income through business and investment. I will share that knowledge as well. Stay tuned.