Get Out of Debt and Then Build Wealth

Before you can accumulate wealth you must get yourself out of debt. You cannot effectively work on wealth creation if you are wasting dollars paying high interest on your credit cards, car loans, student loans or your mortgage. You must attack the debts aggressively before you can expect to invest effectively.

 There are a number of ways to attack your debt. You can go to debt counseling, debt consolidation, debt settlement, mortgage modification, mortgage acceleration & debt elimination or even in extreme situations bankruptcy. There are two options for consumers seeking bankruptcy protection from the courts, either Charter 7 or Chapter 13. You should seek the advise of a lawyer who specializes in this for a free consultation.  Each of these choices has its pros and cons, you must fully understand each one so you can make the appropriate decision for your situation. The key to success with any system or program is that you must be totally committed to resolving your debt situation. Too many people enter into these solutions with a complacent  attitude  and drop out before their program is completed.

You can utilize a combination of the services listed above in order to get out of debt in the quickest time possible. Lets elaborate by looking at the debt situation of our fictional subject Joe.  Joe is a homeowner with a wife and two children, he worked for Corning Glass for the past 15 years and was earning $40,000 per year. He refinanced his home for the second time two years ago so he could “lower his payments” and get some cash out of the home to pay off some debt. Now his $200,000 home is mortgaged to the hilt, his home value is dropping, he still has a truck loan, he has been using his credit cards to pay bills, gas and food lately, OH! He was late with a credit card payment and the Bank raised his interest rate to 29%!  AND He was just informed his hours are being cut by 5 hours per week-Thank God he still has his job.  What is he gonna do?

 The first thing he needs to do is to find out where he’s spending the money. This requires budgeting and eliminating ALL unnecessary spending. Then he should go to an honest Financial Services Company and figure out what course he needs to follow. Then he should go to a Mortgage Modification Company and try to get his existing Mortgage rate reduced. When he gets those programs in place he should talk to www.TeamPayitOff.com  and have them run his financial analysis so he can see how much time and interest will be saved paying off the remaining debts and mortgage.

By this time Joe should have freed up some discretionary income from the budget and should seriously consider allocating  some dollars into a Whole Life Insurance program, this savings vehicle accomplishes many things such as financial protection for his family in the event of his death, creates a forced savings plan with compound interest that can be used tax free in the event of an emergency and creates a tax free environment for retirement.

 So there you have it, a brief synopsis of how to get out of debt quickly and start building your wealth. Future articles will go into detail on each of these programs. If you have any questions feel free to add a comment or e-mail me at wayne@teampayitoff.com I will be happy to answer any of you.

Wayne Isaksen