The Fashionable Way to Financial Freedom 

Debt can be a burden that weighs us down and restricts our freedom. It’s like wearing a tight-fitting outfit that doesn’t allow us to move freely. But just like how we can change our clothes, we can also change our financial situation. 

What is debt?

Debt is the amount of money that you owe to someone else. It can be a burden that can weigh you down, cause you worry and frustration and make it difficult to achieve your goals. Getting out of debt is not easy, but it is possible. 

I hope that this post can help you understand what debt is and how to get out of it. 

When Debt Becomes a Fashion Faux Pas 

The Heavy Coat of Debt 

Debt is like an oversized coat: Just like how an oversized coat can make us look frumpy and unflattering, debt can weigh us down and make us feel unattractive.

So, what exactly is debt?

Debt is a financial obligation that one owes to another party

There are several types of debt, each with its own characteristics and implications.

Here are some of the most common types of debt:

Secured Debt: This type of debt is backed by collateral, which can be seized by the lender if the borrower fails to repay the loan. Examples of secured debt include House and Vehicle loans. 

Unsecured Debt: This type of debt is not backed by collateral and is based solely on the borrower’s creditworthiness. Examples of unsecured debt can be credit card debt and personal loans. 

Revolving Debt: This type of debt allows the borrower to borrow up to a certain limit and pay back the borrowed amount over time. Credit card debt is an example of revolving debt. 

Instalment Debt: This type of debt requires the borrower to make regular payments over a set period until the loan is paid off. House and vehicle loans are examples of instalment debt. 

Consolidated Debt: This type of debt involves combining multiple debts into a single loan with a lower interest rate and a longer repayment period. 

Payday Loans: These are short-term loans that are typically due on the borrower’s next payday. They usually include high interest rates and fees. 

Student Loans: These are loans that are used to pay for education expenses such as tuition, books, and living expenses. They can be either federal or private loans.

Medical Debt: This type of debt arises from medical expenses that are not covered by insurance.

The Ill-Fitting Outfit of Debt

Debt is like a pair of shoes that doesn’t fit: Just like how a pair of shoes that doesn’t fit properly can cause blisters and discomfort, debt can cause stress and anxiety.

Dressing Up Your Finances

Creating a Budget: Putting Together the Perfect Outfit

Creating a budget can be like putting together an outfit – you need to choose the right pieces that fit well together. Think about how it feels to wear an outfit that fits perfectly and allows you to move freely. Your debt-free life can be just like that outfit- comfortable and free to move.

Cutting Expenses: Tailoring Your Spending Habits

Here are some ways to cut expenses:
• Cook for yourself instead of buying takeaways
• Carry your lunch to lunch instead of buying lunch daily
• Renegotiate your rent or house payment
• Shop around for better deals on insurance, phone plans, and other services
• Use coupons and shop during sales to save money on groceries and other essentials
• Buy essential items in bulk when shops have them on sale
• Cancel unused subscriptions and memberships
• Reduce your energy consumption by turning off lights and unplugging electronics when not in use

Increasing Income: Accessorising Your Income Streams

Here are some ways to increase income:
• Begin a side hustle or freelance work
• Ask for a raise at work
Work overtime
• Sell items you no longer need or use
• Rent out a room in your home
• Create a passive income source
• Look into investment opportunities

The Benefits: The Joy of Wearing a Perfectly Fitted Outfit

Debt is like a fashion trend that’s gone out of style: just like how a fashion trend that’s gone out of style can make us look outdated, debt can hold us back from achieving our financial goals.

The Freedom to Move: Living Debt-Free

Debt is like a cheap knockoff: just like how a cheap knockoff can never compare to the real thing, debt can prevent us from experiencing true financial freedom.

Here are some tips on how to avoid getting into debt: 

Create a budget and stick to it. This will help you see where your money is going and where you can cut back. 

Don’t buy things you can’t afford. If you can’t pay for something in cash, then you can’t afford it with a card. 

Have an emergency fund. Emergency savings are very important for those “just-in-case” situations. Try to save atleast three months worth of your usual expenses as your emergency fund.

Pay off your credit card balances in full. The best way to keep your spending under control is to pay your credit card balance as you go. 

Cut out the wants, focus on the needs. There’s always room in your personal budget to cut out unnecessary spending habits. 

Limit the number of cards you have. Try not to apply for too many store accounts and credit cards. Multiple credit cards mean multiple payments and multiple cases of tacked-on interest. 

Time to Change Your Financial Wardrobe

Getting out of debt is like putting together an outfit. You need to have all the right pieces in place to make it work. 

You need to have a plan, set goals, and stick to them. Just like putting together an outfit, getting out of debt takes time and effort. Be patient, and eventually you will get there. 

Here are some tips on how to get out of debt: 

First things first: Call your bank or loan company to explain your situation and that you will need more time to repay your loans. 

Stop borrowing money. No more swiping credit cards, no more loans, no more new debt. 

Pay more than the minimum amount due. The best way to get out of debt faster is to pay more than is expected every month. This is something that I do personally. 

Use an accelerated debt repayment plan. This is where you pay off your debts in order of interest rate, starting with the highest. This is a highly effective way of getting out of debt quickly. 

Create a budget and stick to it. This will help you track your expenses and decide where you can cut back. 

Sell things you don’t need. You will be able to quickly raise extra cash to pay off your debts. 

Get a side hustle. You can earn extra money to put towards your debt, and who knows where this side hustle can lead you? 

Seek professional help if needed. There are many organisations that can help you get out of debt, such as credit counselling agencies. 

The Confidence to Shine: Achieving Financial Goals 

Debt is like a fashion trend that has gone out of style. It may have been popular at one time, but now it is outdated and no longer fashionable. 

Getting out of debt means letting go of old habits and embracing new ones. Getting out of debt is like walking confidently down the runway. 

You need to have confidence in yourself and your abilities. 

You need to be focused and determined to succeed.

You can do it!