The Power of Decisions
Ralph Waldo Emerson once said, “Once you make a decision, the universe conspires to make it happen.” Truly, great power is released when we make an uncompromising decision. Hence, the importance of deciding once and for all that you will get out of debt and stay out of debt for the rest of your life. With an unwavering commitment to a new financial reality, you will do what it takes to make it happen.
For the record, when I say “decision,” I’m not talking about casual decisions on par with “what do you want for dinner?” I’m talking about binding decisions like “I’m ready to have kids” and “I want to marry you.” I’m talking about the kinds of decisions from which there is no retreat and no turning back.
Paraty, Brazil
My Decision Story
I remember the day when I sat next to our hacienda’s pool overlooking beautiful Paraty, Brazil. A few days before, my husband and I had seen a piece of land that seemed perfect for the school we long to start in Brazil, and as an added bonus you can see the ocean from a building’s second story. I thought about the land and the amount of money it will take to free it from the mess of red tape it’s in and obtain it; it is no small number. Then I shifted back to reality, where we sat $50,000 in debt, seemed unable to get a grip on our finances and knew that without dramatic change we would give up the land, and our dream.
An indignation rose up within me that immediately turned to resolve. Right there Marco and I firmly decided to get out of debt, to stay out of debt for the rest of our lives and to do what it takes to make it happen (not quit) until it was reality.
A set of three decisions, made on a single day by a pool in Brazil changed our life forever. It only took three decisions because wrapped up in those three things are one hundred other things like “I will live within my means,” “I will stop trying to keep up with the Joneses,” and “I will change my relationship to money.”
Your life too might be one set of decisions away from its turning point.
You Have Three Decisions to Make
Getting out of debt is no easy task. Staying out of debt requires even more fortitude. But, if a powerful dream is rocket fuel that propels you toward debt freedom, then a set of unwavering decisions are the GPS that keeps you on track.
Articulating a dream is a cornerstone to financial change, but a clear, point-in-time decision to change is as important.
Your decision to change your financial destiny needs to include these three components:
I Will Get Out of Debt
“I will get out of debt” is not the same as, “I might get out of debt” or “I hope to, one day, get out of debt.” Nope. I will. I. Will. You need to declare it for yourself that you will get out of the situation you are in. Yes, you. That includes you, the one that is up to their eyeballs in debt and can’t go a day without sobbing under the weight of it. Yep, you can get out of debt too, but not without deciding to do it.
I Will Stay Out of Debt
I had been out of debt in my mid-20’s with money in the bank, but forgot to decide that I wouldn’t turn to debt again. Whoops! I fell back (and married back) into $50,000 in debt as a result. That’s why the second time I decided to get out I said to my husband, “it’s so much work to get out of debt that I won’t do it unless we agree not to end up here again.”
There is one just one key to staying out of debt forever. It’s so simple I’m embarrassed to say that it was revolutionary to me when I realized it.
The only way you stay out of debt is to save money in advance for your expenses.
Our decision to stay out of debt has meant that we prioritize our spending, save for big ticket purchases in advance and opt to be satisfied with what we have.
I Will Not Quit/I Will Do What It Takes
Right now, before the starting gun fires for this marathon you have to decide you’ll see this through to the end. Look, I was a blue ribbon quitter that believed quitting was better than failing (it’s not) and I bailed on most everything I tried as soon as it got too hard. As a young adult I was tired of the missed opportunities I’d already experienced. I was tired of the fear of failure’s effects. My answer? I quit quitting, posting notes in my cubicle and bedroom reminding myself, “the last thing I quit was quitting.”
By deciding up front that you won’t quit until you get out of debt and stay out of debt you are outsmarting yourself. One day you might have to make a choice that feels hard. You’ll wish you had credit to run to, but you won’t (see decisions #1 and #2). Then, as you look for an escape to the pressure of the moment you’ll think, “I know, I can just bag this whole ‘getting out of debt thing’ and go back to how I was. That’s it, I won’t violate either decision I’ve made per se, I’ll just quit the plan all together.”
Or, you’ll fall off the wagon. You will have a few months of solid financial stewardship under your belt, then your sister comes into town and you blow it. You go overboard at the mall, eating out, and buying gifts for her new baby. As you lay in bed after the fact, you’ll think, “I’ve done it now. I messed everything up. I might as well quit now since I am not on track to getting out of debt any longer. And, besides, we’ve needed a new window in the kid’s bedroom. At the rate we’re saving it’ll never happen so I’m done with this ‘getting out of debt thing.’ Tomorrow, I’ll just order the new window on a 12 month payment plan. Maybe someday, when it’s more convenient, I can come back to this.”
One thing that can help you get through those trying times is a tangible reminder of what you have promised yourself and your family.
Make Your Decisions Tangible
I remember where I was when we decided to change our financial situation. Many times, I have replayed the scene in my mind and drawn strength from what transpired that day. My memory of the moments is sharp, but that’s all I have is my memory. If I could do it over again I would have written everything down. I would have signed a commitment to myself and my family to get out of debt, stay out of debt and not quit until we’d done both. I’d have asked Marco to sign and date it too.
Think of a wedding. It isn’t the ceremony itself that legally binds the couple together. It certainly isn’t the rings or the photographs. In the eyes of the law, a couple is married because they have a signed marriage certificate. Yes, you have a ceremony. Yes, you say vows. Yes you exchange rings and take pictures, but if you don’t sign the certificate you aren’t legally married. Period.
I think too of the Declaration of Independence. Think of the honor we give the men who committed deeply enough to a cause that they signed their names acknowledging their convictions.
Now Is a Good Time
To take it full circle, I think Ralph Waldo Emerson was right. “Once you make a decision, the universe conspires to make it happen.” For us, in modern America, land of “please don’t make me commit to anything and certainly not publicly” it’s time to decide for yourself. Today, spend time thinking about whether you can commit to get out of debt, stay out of debt and do whatever it takes to make those things happen. Don’t wait until tomorrow or next month or after you’ve paid off the car or last year’s Christmas gifts or after you take a family vacation.
Decide now, then follow along here as we share more about what my family did after deciding to change. Read other posts in this How to Get Out of Debt series.
Your turn: What do you think? Are there other foundational decisions to be made? What hinders your commitment?
Photo credit to Travel and Leisure
About Carrie Rocha
These big picture ideas are really great but could you please elaborate on the how?
I know that not eating out and coupon shopping did not cause you to get out of $50,000 of debt. There has to be so much more to the story than that. I appreciate all that you do but find it really frusterating that the how is always left out of the subject. If you don’t come close to making $50,000 annually, its so not tangible to pay that kind of debt off in a couple of years with a mortage, car payment, etc- even if all you do is pay all bills and buy nothing. Any more information you can provide would be wonderful.
@Anon – I’m guessing (though I’m not positive) that Carrie will give tangible steps on how to do this in a future post in her “How to Get Out of Debt” series.
Laura’s right. Stay tuned. I am trying to write things out one little piece at a time, starting with the big picture, then moving into some personal financial management (making a spending plan, etc.), then talking about how to rapidly pay down debt.
The key sentence you wrote above that shouted out to me was: “The only way you stay out of debt is to save money in advance for your expenses.”
When I look at the times my husband and I turn to credit cards… even though I know we shouldn’t…is for items/services that we should be saving for in advance (car maintenance, home repair, even vacations)
Thanks again for a wonderful and inspiring article!
I found this website over a year ago. I was so inspired by the story. I wanted to be out of debt RIGHT NOW. Things were ok at the time for me hubbie and I. I clipped and clipped, scrimped and picked up pennies off the ground anything I could. I was able to pay off a credit card balance by making large payments to them(almost a grand a month). Paid one debt off and then the bottom fell out of the economy right after that. Right before christmas. My husband has barely worked since then. Only here and there . My question comment is. Was I wrong to pay that off so fast or should I have saved first for what is now happening and still had the debt?. Now we are at one income and doing that is only a dream. Now it is as bad as it has been. But we both have our auto’s paid off and will not get a new car until I have put money away for that. How do you do that(save) when you are at one income?. And the income you have is not a set amount every month(self-employed). Salary fluctuates and only paid once a month? Thanks Carrie
Kim – Congrats on your hubby’s job offer! Yay! I will be talking more about my opinion on the save first/pay down debt first dilemma, but in a nutshell, I believe in building an emergency fund (and actually something worth more than $1,000, which is a point of disagreement I have with Dave Ramsey) as a first priority and then paying down debt. The reality is that life happens and we need to buffer ourselves from the need for future debt, since this is about getting out and STAYING out of debt forever, In my experience so far, getting out of debt is easier than staying out of debt – because avoiding more debt requires you to save today for tomorrow’s expense at the same time you are paying today for yesterday’s expense. Just a few initial thoughts, but stay tuned as we’ll keep talking about this in the days and weeks ahead.
This is the perfect article coming to me at just the right time in my life. Thanks to Carrie, Laura and Staff, and the Pocketeers for making me believe I can do this and sharing their stories and inspiration. I can just imagine the day when I can shout, “We’re out of debt!!!!!” from the (paid for) roof top!! Love you all!!
I’ve heard a lot of financial experts ask the same question, Kim. Is it better to have money saved and still pay interest on your credit card while you pay it off? Or should you save money by paying off the cards and not have much/any in savings?
I paid off everything in February 2010. It was seriously one of the best days of my life. I was completely debt free except for the normal expenses, and I also had $800 in savings. Doesn’t sound like much, but my monthly income was about $1700 so that was HUGE for me. I had a plan and a budget, and I stuck to it until April, when I got sick. I blew through the savings pretty quickly because of the illness, when I needed to take cabs to appointments, make copays, have groceries delivered and had very little money coming in. If I had been well, I would have been able to research ways to save money (like I didn’t know until two months later that there were some lower cost services that could help me get to medical appointments and that I also qualified for food stamps and some other assistance programs). I’m not even sure at the early point of my illness that I would have been able to negotiate the filling out of forms. So I’m back in debt, and this month I am only paying the minimum on my credit card, BUT the total I owe on the credit card is $350, not the $2800 I owed last year. I know I will pay it off again, and will also have a payment plan in place within the month to pay off the hospital copays.
Is it possible for you to get something that would generate any income? Right now is a one-income plan the best for you?
Thanks for your reply Sheepy. It is now almost 5:30 and wow how God has helped me in the last few months. Every time I am “fretting” over a bill that needs to be paid and having no money something comes in the mail, etc. Well I posted that post earlier today and since then my hubbie got offered a fulltime job. I hope it works out for him. Construction is down right now and he was lucky to get it. Hopefully now I can do both- save and pay down debt. I hope you are better now. God Bless.
The only debts we have is our mortgage, my student loans, and my husband’s car loan. What hinders our commitment is that my profession is a low paying profession, my husband makes very little money, and we aren’t on the same page when it comes to finances.
Kim, great news!
I’ve recently been investigating debt payoffs myself. To answer some of the questions here, another financial expert I trust suggests $1000 in savings before paying off debt. (If $1000 is way to difficult for your income, then $500). This will help prevent turning to credit cards for emergencies. The next step is to pay off all the debt, smallest to largest. Yes, the highest interest rate first makes more sense, but, little payoffs will create momentum. I’ve gotten excited when I can payoff a small debt only to turn to the next smallest and say “YOUR TURN”. :)
All in all, since April 2010 I have paid off about $10,000 and hope to finish the addtional $20K in the next 2 years. That does not include my house. He (financial guy) suggests paying the house off last if it is more than 50% of your income, and mine is. I am on track to be completely debt free in 5 years and it is possible!
I am a single gal, with one income. No, I don’t have kids and I only have me spending my money, so you might think it’s easy. But don’t forget, I also don’t have the built in accountability from a spouse or kids who might cause me to think “If I spend this money, they don’t eat”…so it’s not as easy as it looks. But like the article says, Look at the Prize at the end! Keep your focus and you will get there!!
I haven’t even finished reading this WONDERFUL INSPIRING entry of Carrie’s and it brings me to my ongoing dilemma I have with accomplishing this: I LOVE to save and go the extra mile in my resolve to get out of ALL debt including our home by the time I am 55. I think it is possible BUT I have a husband who just doesn’t fully get it. For example; it was Friday I was leaving for the weekend we were almost out of milk so I knew I where I could pick some up way cheaper (than our local store) on my way home on Sunday…which I did for about 75 cents cheaper per gallon than the cheapest I can get it at our local Walmart. But when I get home I see my husband STOCKED UP on milk (three gallons worth at our expensive local store) for a 1.75 more per gallon than I spent! FRUSTRATING!!! And don’t think the solution is simple; yes we have talked about this; where we are going with our finances etc…and to think about such things and money being spent; it does not take a brain thrust to know not to do things like that! Sure yes get a gallon he needed milk for the weekend but he should know full well NOT to stock up with expensive milk but he did it anyway. Anyway that is my issue multiplied over and over. I willingly scrimp and save and I feel he basically blows my work and savings on situations like that. It does make me want to throw my hands up but I won’t….any ideas on how I can get this to stop at least 95% of the time? Oh by the way we also have a teenage son who does not have a job and seems to be following in his father’s footsteps~HELP!
I know EXACTLY what you mean. I am in the same boat with my hubs. I scrimp and save and even recycle cans to try to build my emergency fund and he will go and blow money and basically eradicate any and all of the work I’ve done. It is SO frustrating *pulls hair out*
Oh gosh, someone please give me some hope! I swear I’m never going to see the “debt free” day. We were unable to sell our house before we had to move for my husband to start medical school. We have thousands sitting on our credit cards because of renters that wouldn’t pay. Apparently the law says landlords have no right to kick people out on the street, but it’s ok for someone else to run up my credit card, not to mention that my credit score used to be awesome and has now dropped 200 points. Since my husband is in his 3rd year of medical school he has had very little income for the past 2 years (like, he mows a few lawns in the summer). We have 2 little ones at home and live on student loans and my part-time job. I’ve done everything I can think of to generate some more income… teaching piano lessons from home (my students loved it, but either just flaked out or couldn’t afford it), selling baby bows and bracelets online, and looking for other part-time work that will fit in our schedules. We just can’t seem to catch a break! Good news is, my husband will have a six-figure income, bad news is that we still have to survive 2 more years of school, and 3 years of residency (which he will only get paid around $40,000-$50,000/yr), AND we will have a mountain of student loans to pay off. I see all this get-out-of-debt-advice but it’s rare that I can apply it to our situation. Any suggestions???
Someone please help…… I want to be out of debt and be able to enjoy live. My husband left me two years ago now and I have to wonderful daughters,.. and one heading to college in 3 years. My divorce cost me about $25,ooo…. he fought and fought and needless to say all the things he fought for… he doesnt even do. He doesnt have anything to do with his daughters and now he has no job and not paying any child support…. so I am doing it all alone and just want to get back on track so I am not so stressed all the time….. I have about $6000 on credit cards, most of which is the last of my lawyer bills… have a house, and all bills that go along with that, car payment, My bills are more than my paychecks… please any suggestions welcomed to get out of debt….. I want this more than anything!
Hi Heather,
Following the tips and coupons on this site are great, but if you are looking for more I highly recommend Dave Ramsey (www.daveramsey.com). He has some incredible, easy to follow, steps that will take you through the tough times. I’m not saying that the road will be easy, but the steps to get there are simple to follow:
- make a budget
- stick to the budget
The first things on the budget are house, food, electricity/water, transportation.
The last things on the budget are credit cards.
We think we need to pay the credit cards before we eat, or feed our family, because the credit cards threaten us so badly. But the reality is, you have to take care of yourself first. The rest of the bills will get paid.
I’d love to talk with you more. rachel@3freedomsteps.com