Reduce your debt to build wealth
Reducing debt is easy in theory but exceedingly difficult in practice. We all need to borrow money at some point in our lives, whether it be to buy a house or start a business.
Whilst debt leveraging can be a useful wealth-building tool, in most cases reducing or removing all debt will result in a higher standard of living. The less debt, the more disposable income you will have.
Implementation and Cost
- List all current loans, outstanding balances, and interest rates.
- Work out your total weekly spend on debt and interest paid.
- Consider debt consolidation or refinancing if it results in reducing your regular interest payments and term.
- Contact each lender and ask for a better rate.
- Increase your regular payments where possible to shorten the loan term.
- Look for any loans you might be able to remove immediately e.g a car lease. (You may be able to drop your car lease and buy a more affordable vehicle out right).
- Remove subscription services that you do not need to reduce monthly costs. E.g Netflix.
- Ask for reduced rates on your car, home, and life insurance.
"You’d be stupid not to try to cut your tax bill and those that don’t are stupid in business"
- Bono: U2