Six Essential (and EASY) Steps to Eliminating Your Debt and Getting Richer
Get the help you need to see your path to financial freedom
At the time, it felt like 1985 was the worst year of our life. But in hindsight, it was the beginning of our best years.
We were flat out broke. Between the two of us, Kim and I had about $400,000 in personal debt, most of which I owed to creditors due to the loss of my first business—and the interest was making that number grow fast.
What little savings we had was gone in three months, and for a short period of time, we were homeless. To survive, we maxed out every credit card we had, which meant our debt was growing even more.
Our most valuable lessons
We were tempted to declare bankruptcy and start over, but we didn’t. We chose to learn the important lessons that paying back the debt would teach us. By 1990, we were out of debt, and a few years later, we were financially free. Today, we’re worth over millions.
We are richer, not just because we have a lot of money—but also from the experience and the lessons we learned digging our way out of debt. The following are the six essential and easy tips we learned from our experience that can help you also eliminate your debt and get richer.
Tip #1: If you have credit cards with outstanding balances, keep only one or two credit cards in your wallet.
Keep the other cards out of sight, preferably in a safe or a safety-deposit box. Any new charges you add to the one or two cards you now have must be paid off every month. Do not incur any further long-term bad debt.
Tip #2: Come up with $150 to $200 extra per month.
When Kim and I were in our toughest times financially, we learned how to hustle. We worked odd jobs here and there, all while working on building our own business on the weekends. It wasn’t hard to earn a little extra money here and there. We simply had to keep our mind open to the possibilities around us. If you cannot generate an additional $150 to $200 per month, then your chances for achieving financial freedom may only be a pipe dream.
Tip #3: Apply the additional $150 to $200 to your monthly payment of ONLY ONE of your credit cards.
Pay the minimum PLUS the $150 to $200 on that one credit card. Pay only the minimum amount due on all other credit cards. Often people try to pay a little extra each month on all their cards, but those cards surprisingly never get paid off.
Tip #4: Once the first card is paid off, apply the total amount you were paying each month on that card to your next credit card.
Pay the minimum amount due on the second card PLUS the total monthly payment you were paying on your first credit card.
Continue this process with all your credit cards and other consumer credit such as store charges. With each debt you pay off, add the full amount you were paying on that paid-off debt to the minimum payment of your next debt. As you pay off each debt, the monthly amount you are paying on the next debt will increase.
Tip #5: Once all your credit cards are paid off, continue the procedure with your car and house payments.
If you follow this procedure, you will be amazed at the shortened amount of time it takes for you to be completely debt-free. Most people can be debt-free within five to seven years.
Tip #6: Now that you are completely debt-free, take the monthly amount you were paying on your last debt and put that money toward investments.
That’s how simple it is.
The good news is you don’t have to do this alone!
When Kim and I were getting out of debt and on the path to making millions, we had friends and advisors every step of the way. We believe so strongly in the power of a community, that we’ve spent our lives building a company that provides for countless others the same help and encouragement we had.
You can start getting out of debt—and getting richer—today!
If you’re ready to take control of your financial future, Rich Dad’s new QuickStart program is here to help.
Learn proven principals and strategies—like the six I just shared—that Kim and I used to erase $400,000 in bad debt.
Now is the time to take action. Don’t wait. Start your journey to financial freedom today with Rich Dad’s QuickStart program.