The following is a guest post Daniel Packer from Sweating the Big Stuff. Be sure to check out his site!
I’m in quite a bit of debt, but it doesn’t really bother me. I know that I won’t be getting out any time soon, but I’m ok with it. I don’t need to worry, I don’t need to make drastic changes to my life, and I don’t need to take a second job. Why?
I Have a Plan
I have a budget and I know that I’ll be paying off this pile of debt for the next few years, but my plan is to have a positive net income in 18 months. If I continue to save and pay off loans at my current rate, I’ll creep into positive territory around July 2011. I am responsible and know that I need to save before I spend, and this has allowed me to tackle my debt slowly but surely. I don’t feel overwhelmed because I know that I will eventually dig my way out of debt. If I stick to my plan, what do I have to be worried about?
I Live a Decent Quality of Life
Since graduating from college in May, I have slowly weaned myself off of my pasta and grilled cheese diet. I spend some money on fun experiences with friends, and eat out occasionally. I am not depriving myself from having fun, and am able to enjoy myself despite being on a strict savings plan. Since I don’t feel like my debt is weighing me down, I don’t stress over it.
I Automatically Save and Pay Off My Loans
I set up my finances to be on auto-pilot. I don’t need to constantly look at my checking account to see if there is enough money to pay the bills. After my paycheck gets deposited, money is automatically transferred to my various accounts – savings, investing, loans, etc. I never really see this money in my checking account and have learned to live on about half of my take-home income. Automatic bill-pay lets me relax while knowing that my bills will be paid on time without even having to push a button.
I Knew What I Was Getting Myself Into
In deciding to go to college, I made a decision to pay for it afterward. These loans average about 2.8%, which is nothing compared to some credit card rates. As the economy improves, the rates will increase, but by the time that happens, I will have cut off a large chunk of the debt. I don’t regret getting myself into this situation, and if I could do it again, I would make the same decisions.
I’ve read a lot about how finances can affect people physically and emotionally, and I know how easy it is to be stressed about our financial situations. There have been times when the simple decision of whether or not to buy a candy bar from CVS has make me stress out. Take time to make a plan and you’ll be able to relax, spend a lot less time worrying about that candy bar, and focus on the things that matter.