Steps For Getting Out of Debt

Getting out of debt is really pretty simple, yet can be one of the hardest things a family can tackle. The process works best when both husband and wife are working together.

1. Stop borrowing.
2. Save money.
3. Sell things to generate cash.
4. Work overtime or get a second job.
5. Prayer...this really works.

Gazelle Intensity

This is one of my favorite concepts in FPU. Proverbs 6:1-5 talks about “Deliver yourself like the gazelle from the lion...”. Getting out of debt is motivational not mathematical. If it was a matter of math, we wouldn't have gotten into debt in the first place.

Gazelle intensity is putting all your focus on the process of getting out of debt. Studies have shown a task is easiest to complete when we focus on one thing. The debt snowball is the process through which we direct that intensity.

Debt Snowball

In the debt snowball, we organize our (non-mortgage) debts smallest to largest regardless of the interest rate. We pay off the smallest one and add the amount of this paid off debt to the next largest debt and continue the process until all the debts are paid off.

Paying off the smallest debt first is motivating and the feeling of progress will help you keep going.

Most families can get out of consumer debt in 2-3 years using the debt snowball and gazelle intensity process. It is very motivational to listen to the debt free stories of families just like yours on DaveRamsey.com.

Financial freedom isn't free. It takes discipline and hard work, but just think of how much you can give and save when you have no payments. Just think how cool it will be for your students to go to college debt free, to pay cash for cars, and pay off your home early. Dream about what your family tree will look like 20 years from now, what mission projects you can fund, and what kind of legacy you can have if you “break the chains of debt”.

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Brian and Lisa Petersen, lead the Financial Peace University course at Autumn Ridge Church. Concepts like the one discussed in this article are taught in FPU. Brian and Lisa welcome your questions on “Breaking the Chains of Debt”. They can be reached at brian@vegetablefreak.com.