Most people have some kind of debt. This is normal, but as you approach your retirement years, you should already be free from all these. You must have already paid off your mortgage loan and you should no longer have credit card balances from purchases that you couldn’t really afford.
However, if you still have debt weighing you down and you’re already in the last few years of being employed, you should start taking drastic steps in getting rids of all debt.
So, what should you do? Financial experts have rounded up some of their best pieces of financial advice that will help you become debt-free in time for retirement.
- Take your credit card out of your wallet.
This seemingly simple measure works. Jonah Lehrer, the author of “How We Decide,” says: “When people pay with a credit card, their brain processes the transaction differently than if they use cash.” Paying with a credit card doesn’t hurt, unlike with cash, which is a dangerous thing. A study conducted in MIT even reveals that people at auctions tend to pay twice the amount with a credit card than they would with cash. You can completely resist the urge to spend money you don’t have if you simply take your credit card out of your wallet and pay with cash as often as possible.
- List your daily expenses.
While this may seem taxing, it will make the money you release “more real” in your eyes. From the list, you can identify what was necessary and what simply was driven by whim, which you shouldn’t be indulging in given the debts you’re paying off.
- Stop indulging your “woe is me” mentality.
You work hard, so you deserve something nice every now and then, right? This mentality is probably one of the reasons why you have a standing balance on your credit card. Remember, things are just things, and the high they give is just momentary. What’s more fulfilling is to have peace of mind from not owing any person or organization money, or not going into retirement with reduced income and still having to pay off debts.
- Control your optimism.
Of course, it’s great to look at the positive side of things, but stay realistic. Don’t make financial decisions now based on the money that’s still yet to come. It’s hard to be certain about the future, so don’t rely on a potential raise or the fat tax refund. When you make spending decisions, always base them on your current resources.