For some of us with debt, we feel rooted to our current location, job or life situation because we can’t afford to change. But have you ever added up all your monthly debt payments and multiplied them by 12 to see how much less per year you could handle if you didn’t have that debt?
For us, at one point, we were paying $1400 per month, or $16,800 on debt payments (not counting our mortgage). Now we’re down to about $800 per month, but that’s still almost $10,000 per year coming out of our post-tax income. Additionally, that’s $10,000 more per year that we need to earn just to maintain our current quality of life. How crappy is that?
So how much is your debt holding you back from accomplishing your dreams or simply improving your station in life?
Perhaps you currently make $65,000 as an IT analyst in D.C., but would rather be an artist in Kansas which usually pays about $35,000. However, you pay out $15,000 in debt each year and, even with the cost of living difference, would need to make say $50,000 per year in Kansas to maintain your standard of living and cover your debt. So you’re stuck until you can pay off that debt. You’re unhappy. You’re depressed.
Take the time now to do the math and figure out how much your debt is holding you back from attaining your goals, dreams and desires. Then when you know that number, create a budget and set new goals for getting out from under that heavy hand of debt.