Offsetting Debt

Now that we've discovered how much debt you have & how you're going to tackle that let's focus on how to offset that with income. Most people work one, possibly two jobs. Right after college I was neck deep in credit card debt & kept falling under. To get out faster I worked a full time job as a Business Manager for a non-profit theatre, evenings in retail, then started my third "job."

I place "job" in quotations because it never felt like a job and I sure had a blast working at it. After surfing the internet one day I came across a posting for a work from home cosmetics sales rep. I knew nothing about cosmetics, but knew a lot about sales. So, I submitted my contact information and scheduled an appointment.

The appointment was like a dream! I was being given the tools to set my own hours, set my own goals, & have guidance along the way to achieve them. My initial goal was to pay off around $2,000 in credit card debt within a year. I completely submersed myself with the company - reading the success stories, carrying business cards everywhere, dropping flyers around the town. It eventually paid off!

While a direct sales company may not be for you, there are plenty of other easy money earning opportunities. Since my cosmetic sales experience in 2013, I've moved my sales to an online store and have seen great success with it. Online sales are the wave of the future, so hop on & find a way to get in on the action! 

Debt...

Now that we've discussed what an empire is, let's chat about the first piece to designing your own.  This is usually a sore subject, but it must be addressed - debt.  Being in debt is the one way for an empire to fail.  Getting rid of the debt chains holding you back is not easy, but it can be fun and rewarding!

When I first moved to Pennsylvania I had almost $5,000 in credit card debt.  I knew in order to survive this had to disappear.  It would take me almost 18 months, but I stuck to the task at hand and accomplished it.  The key to making it vanish is to develop a plan and stick with it.  Below is a general step by step guide of what worked for me.  Hopefully it'll work wonders for your empire, too!

Step One: Organize your debt by the current interest rate.  Rank each one starting with the highest rate first going down to the lowest rate.

Step Two: Organize that same set of debt by the balance due.  Start with the highest at top and move to the lowest.  Some people have multiple credit cards with small balances on them.  I once had three separate cards with less than $500 on each.  Yet, I never paid them off and always paid the interest.

Step Three: If the balance on your lowest card is under $500 pay it off first.  Do whatever it takes to get it paid off.  This may seem silly, but it's very rewarding.  You'll be able to immediately see your progress in action.  Seeing the progress you're making will motivate you to continue on!

Step Four: Call each debt company (credit cards, auto, etc.) to ask for a lower interest rate.  Occasionally they will reduce your current rate based on the market.  This take a bit of time, but can save you big money.

Step Five: Lock your credit cards up if you have them.  Leave them at home, freeze them in water, put them in a safe, whatever it takes to not carry them with you.  I now keep mine in the safe and pull them out to travel.  There is no need to carry credit cards if you have revolving debt you're paying on.  Some people choose to cut their cards up, but I advise against this since companies may charge you to send a new card.

Now that you have a list of all your debts you can begin working on paying it off.  Designing Your Empire is useless if you have major debt.  Just remember to focus on the prize.  One thing I do to stay inspired is to keep pictures of my goal.  My life goal is to own a farm, so my computer & cellphone background is a barn.  Every time I think of unnecessary spending I remind myself that money could go toward my farm dream.

Getting Started in Designing Your Empire!

An empire is not something that is designed overnight.  It takes hard work, time, and determination.  You have to have the want and desire for it to happen.  Google defines an empire as “an extensive group of states or countries under a single supreme authority, formerly especially an emperor or empress.”  However, for my purposes an empire is more than acquiring property.  (That’s an important piece of building your empire, but not the entire thing.)

The key to success with an empire is to start as soon as possible.  Of course, if you’re reading this as a young adult you have time on your side.  If you’re a bit past your young adult lifespan time can be slowing you down.  Regardless, you must start right now.  As soon as you finish reading this article you must begin researching your current situation.  If you aren’t familiar with your current financial situation you will not be able to move forward with this project.

You’ll want to begin designing your empire by taking a serious look at your current account standings.  To do this create an Excel spreadsheet listing each of your checking accounts.  Be sure to list your checking, savings, and money market accounts.  We also can’t forget to list your debts- every single one of them.  This will be critical in the next step of your building.  Depending on your debt standing this can be a tough challenge.  However, we know that without challenges we don’t become stronger, so be honest with yourself.

At the top of the spreadsheet list your assets- all of your accounts containing money.  You can have one account or ten accounts, but it doesn’t matter.  The important thing is to have them all included; otherwise this project will be a waste.  This list will be a “living” list, as it will evolve as we build your empire even more.  Now is a great time to become familiar with an Excel system if you aren’t already.  At the bottom of the list create a total of the accounts.  If you’re using Excel for your spreadsheet you can use the formula =Sum(A1:A4), substituting A1 and A4 for the cells you’ve used.

After you’ve created the top portion of your list, now we’ll create the bottom portion or the debt part of your financial list.  This is where we will list every account that you owe money on.  Be sure to include credit cards, auto loans, home loans, personal loans, student loans, and any other credit accounts you have.  It is important to list the account even if you do not currently have a balance due on it.  This will be a nice reminder that you have a zero balance on it and are on your way to designing an empire.  Like your assets list, you’ll want to total your debt amount up at the bottom.  The same formula used earlier will work perfectly for this list.

Now that you have a total number for your assets and a total for your debt you can calculate your net worth number.  For this simply subtract your debt number from the assets number.  This can be a scary task for some of us.  When I first completed this task I had a negative net worth.  I was 21 when I first calculated my net worth and this terrified me.  From that point on I made a vow to myself that I would not have a negative net worth for long.  Fortunately, I was able to turn this number into a positive within a year and you can, too!

You’ve done probably the hardest part of this entire plan to design your empire.  This list, which I call your Financial Outlook, will be essential as you work toward your goal.  It will be updated weekly and serve as a reminder of what you’re working toward.  If you’re anything like me you’ll learn more about yourself by keeping this list updated.  I’ve included a sample of my Financial Outlook spreadsheet I used when I first started.  You’re welcome to reference it at any time as you begin your journey.  Each session we will add to this document as you being Designing Your Empire.

Assets
Checking 1	$125.00
Checking 2	$500.00
Savings 1	$1,500.00
Total	$2,125.00
Debt
Credit Card	$200.00
Student Loan	$3,000.00
Auto Loan	$4,500.00
Total	$7,700.00
Net Worth	$(5,575.00)