How to Get Out of Debt: 3 Decisions You’ll Have to Make

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