Debt Busting - Save $6,000 This Year!

Debt Busting - Save $6,000 This Year!

Photo:  Jeff Stutz, former VP of Wellness Development assisting Beth Schomp burn her mortgage at [Our Manufacturers] 2008 Convention.

David Bach, author of The Automatic Millionaire, popularized a term called the “Latte Factor.” Often before lunchtime many people have already spent nearly five dollars on a latte, coffee, muffin, juice, or something.  Maybe it’s a daily ritual of buying a magazine, smoking, drinks, fries, chips, cookies or whatever.  The point is most people are spending at least $5 per day on average for non-essential items.  How much do these small, habitual items cost us?  

Let’s do the math:

$5 per day x 30 days/month = $150.  Over a period you would have saved:

1 year                      =                $1,800

5 years                   =                $9,000

10 years                =                $18,000

This principle can be applied to several aspects of our lives.  Too often every day expenses become so routine we think we need all these things just to survive.  As we evaluate personal expenses and track spending we find that in most cases there are lots of “Latte Factors” throughout the month, some adding up to be quite significant.  Taking an inventory of our spending can be a healthy exercise.  You can actually eliminate a lot of things from your life that really don’t make much difference to the quality of your life at all. The challenge however is finding a deeper “why” within you that will motivate a change of priorities.

At every Convention, we witness dozens of families burning their mortgages from stage.  The feelings expressed from those achieving Total Financial Freedom is really contagious.  Here are some of what some past Award Recipients express:

“It’s such a great feeling when you don’t have any debt and you can go out and spend some extra money. Of course, money can go out of your hands really quickly when you don’t have a mortgage, so you always need to have a plan. But financial freedom is so exciting.”    –Stacy and Gary Bodnar

“We really want to encourage other people to get out of debt. It’s so much fun when you can control your own destiny without financial stress. All of our years working for a non-profit organization, we’d always had to ask for money. Now, instead of asking for money, we’re able to write checks to support orphanages and charities around the world.”     –Dan and Renae Peters

“We’re no different than anyone else when it comes to saving and paying off our mortgage; we just made different choices. People say to me, ‘I wish I could do that,’ and I tell them, ‘You can; you just have to make the choice.’ I knew that financial freedom wasn’t about being flashy; it was about being down-to-earth and having a lifestyle that brings freedom.

When I was teaching [This Company's] Financial Freedom University from 2003-2008, I would ask participants to do the “$500 Exercise”.   This exercise help you find up to $500 or more of monthly waste.  It is an exercise of evaluating “needs” vs. “wants”.

Look at some of these suggestions and add you own to discover  hundreds of dollars in wasted spending and possible cut-backs from your budget.  Calculate how much you spend every month on that item and add it all up until you have over $500.

The daily Juice/coffee & snack               $150

Lawn Care Service                                   $160

Yard Fertilizing Service                            $60

Housekeeper                                             $200

Gas Station Drinks & Snacks                   $25

Vending Machine Drinks &Snacks           $40

Nails & Pedicures                                      $40

Satellite/Cable TV                                     $70

Pay-Off Car Early                                      $300

Dining Out                                                 $250

Excessive Entertainment                          $300

Excessive Gifting                                       $150

Shopping Spree’s (Clothes/Hobbies)      $200

Cigarettes & Alcohol                                  $400

Whatever our small indulgences are for ourselves, most can find some areas to cut back.  When you make the commitment to change your life, there is greater financial success and freedom that can be yours in just a few short years. 

“Five years after we started our home-based business we paid off the mortgage on our first home and all of the tuition bills for our children. Then we worked on some of our other debts, and on January 23, 2008, we became totally debt free.”      –Nancy and Al Studer

“You have to be willing to do without; you have to be willing to not have what the neighbors have.

You have to delay instant gratification, because 10 years from now that will make a huge difference in your life. It has made a huge difference to us, and we never thought of it as a sacrifice. It was a lifestyle we chose in order to accomplish what we knew we’d accomplish in the future, and the future is here.”     –Trixie and Rod Overcashier

Take the $500 Challenge this year and put $6,000 back in your pocket to start paying off that debt.  The add your [new] Income to it and you will begin your journey towards Total Financial Freedom sooner than you think!