Frugality Magazine - Frugal Living Tips for Financial Freedom

How To Pay Off Debt When Everyone Else Is Getting Ahead

It’s very easy to look at personal finance as some sort of race.

We have (roughly) the same amount of time on this earth – but some of us accumulate far more wealth than others.

These are the “winners” of the race, while other people struggle just to stay in the race.

This is one reason why paying off debt can be so difficult psychologically; you’re taking money that could be helping you get ahead in the financial race of life and you’re essentially “throwing it away”.

That money is gone from the equation, while you watch your friends and family members getting ahead. They’re all going on holidays, buying new stuff and enjoying life. You, on the other hand, are standing still.

Or are you?

While I was becoming debt free myself I struggled again and again with this problem. I watched my friends buying more and more “stuff” while I spent the same money on “nothing” – just repaying debt that I’d accumulated as a younger person.

The question is how to stay motivated when everyone else is pulling ahead.

The answer is all in your own perspective.

Firstly, in many cases the people who look like they’re winning actually aren’t. Many of the vacations, cars and “boys toys” they’re enjoying are financed too. Sooner or later they’ll wind up right where you are, having to pay off all that debt.

Except, by then, they’ll likely have accrued so much that it’ll take even longer to pay off.

Paying off debt can be difficult at the best of times. But it's doubly challenging when you look around you and see all your friends getting ever further ahead. Depressing is not the word. So what are you to do? This article discusses how to pay off debt when everyone around you is getting ahead, and how to feel good about your decision - rather than embarrassed.Then of course you change to change your perspective on debt repayment.

The truth is that you can’t get ahead financially and start to build real wealth if you’re drowning in debt.

Therefore rather than looking at debt repayments as “wasted” money, or “negative” money, try looking at it in the same light as putting money into a savings account.

You see, without debt you start your savings account at $0 and build it each month from there.

With debt you start at a negative balance but you’re still constantly building your wealth towards that ultimate goal of positive net worth.

I would argue, therefore, that if you pay off $500 of debt each month, and assuming you’re not stupidly accruing extra debt as you do it, then you should almost look at this money as if it is going into a “net worth” savings account.

Because, let’s be honest, once you hit zero aren’t you then going to be motivated to keep growing it long past that number?

So how do you stay motivated to pay off debt when everyone else around you is getting ahead?

The answer is you reframe your perspective on the situation and take the same amount of pride in paying off debt as you would if you were carefully putting this money away into a savings or investment account. Soon enough you’ll be back in positive numbers, and that’s where the fun really begins…

What’s your debt story? Do you find yourself getting frustrated with your lack of progress? Please leave your experiences in the comments section below…

How to pay off debt when everyone around you seems to be getting ahead. Here's how to end the financial frustration and finally take control of your money...

Richard

Sun-worshipper and obsessive frugality blogger. For loads more money-saving advice come and join us on Facebook.

2 comments

  • Nice article. I found that as I tracked my net worth while getting out of debt, it kept me more motivated because, like you said, it shows your “net worth savings account”. I have vanquished all my debt more then two years ago and have since almost built a fully funded six month emergency fund! Can’t wait to finish that up so that the real accelerators of wealth building can start; investing! Have a great day and thanks for connecting with me on Twitter! I have loaded you up into my RSS reader and look forward to reading more of your posts!

    • Wow – awesome stuff Steven! Thanks so much for stopping by and leaving a comment 🙂