The present economic crisis in America is not solely the result of wrong decision making by the political and corporate elites. We, ‘the people of America’ are no less responsible in giving birth to this crisis. From generation to generation we have been passing on debt as our heirlooms. They have been taught from their school days how to get accustomed with getting and spending habits. Actually the pestering ill has deeply been embedded in the philosophy and psychology of general American population If you need a brand new car, get a car loan. Don’t worry, Credit card companies are there. Use first, and then pay later. This has been the culture for decades.
The situation has gone so far that people sometime buy their Christmas gifts with their credit card. Therefore, when you hear some one advising you to enlist in your budget a little expense on a can of soda, don’t think it is a joke. Can you imagine how many digits 1 trillion dollar consists? America is now under the public debt of $14 trillion U.S dollars. In such a grave scenario only your commitment to stick on a tight budget can save you and get you debt relief.
Converting your debt into wealth is a great formula whose proponents hold the view that debt relief through proper budgeting is hard enough but never impossible. One can get himself debt free within 4-5 years of practice. But one has to stick with it. Behavioral pattern has to be modified. And one has to learn the art of accommodating himself with a water tight budget. He has to save every penny and try to contribute more towards his repaying debt liability.
However, the plan entails that the bare minimum requirement of a repayment schedule has to be maintained. You may choose the one which is smaller in debt size and comparatively lower in interest rate. But once you clear off the one debt liability, just move on to another debt that you incurred. Making a list of all your debts will help you do it easily. However, the plan requires you to have a consistent monthly income. Otherwise, you can do nothing but to knock at the bankruptcy court.
Once you have cleared all your debt, now stick with your earlier budget to save your money. The real game starts from this point. All of your extra penny saved on the dollar can be invested in Mutual Fund. Do not change your habit again and take a retreat to your earlier spending habit. If you can continue to go away with this present habit, you will end up having huge investment return at last. So you will find that debt into wealth formula is not a scam at all. It can be better utilized for your investment benefit.