Pay Off Debt – Part 05

In this series of posts, I am hoping to equip your family to become debt-free!  Jenn and I became debt-free in just 14 months by following this process, and our lives will NEVER be the same!  We have been freed up to pursue exactly what we were put on this earth to do – regardless of the income potential!

Previous Steps:

Step 1 – Understand WHY you want to become debt-free!  You greatly improve your chances of becoming debt-free when you understand the reasons that you are making sacrifices in lifestyle!

Step 2 – List your debts  If you don't know how large the giant is, it makes it really difficult to understand the overall situation!

Step 3 – Calculate your Debt Freedom Date  When you have put together your Debt Freedom Date calculation, print it out!  Put it on the refrigerator!  As you pay off each debt, draw a big line through it!  You will not believe the conversation this will start with your family and friends as they come over to visit (you won't be able to afford to go out to each near as much!)

Step 4 – Establish Accountability  If married, hold each other accountable.  If unmarried, have someone who has won with their own money and has your best interest in mind.

Step 5 – Secure Your Debt Freedom – Save at least $1,000 before attacking your debt!

I have seen so many people calculate their Debt Freedom Date and get all fired up about attacking their debt.  They sell everything and everyone in sight.  They can't shut up about getting out of debt.  It is all they talk about with their spouse.  They have even sold their Clay Aiken AND Celine Dion albums!

Everything goes great for two months.  They smile every time I see them.  "This is awesome", they tell me enthusiastically.

Five months later, they avoid me.  When I ask them what is up, they say something like, "Well, Johnny broke his arm and the emergency room bill and doctor bills cost me $1,500.  I had no savings so now I am right back where I was – falling back into more debt."

How demoralizing is it to attack debt so fervently and then have to go right back into debt?  It is AWFUL!  Don't do that!  Instead, save up at least $1,000 into an emergency fund before attacking your debt and THEN you can attack your debt all you want!

What happens if you have an emergency pop up while you are attacking your debt?  You can use the emergency fund to cover the expense.  To replenish the emergency fund, slow down on the debt pay-off plan until you have the $1,000 back in the emergency fund!

By the way, if you have a house, kids, or more than one car I highly recommend $2,500 for your emergency fund.

Secure your debt freedom plan with your emergency fund!

Congratulations!  You now know the process that Jenn and I used to become (and stay!) debt-free!  You are now equipped!

Question of the Day:  What are you going to do now that you are equipped to become debt-free?

Read Joe's recent blog posts

Subscribe to


  1. JW Thornhill on September 14, 2007 at 3:01 pm

    This is a fantastic blog!

    I just downloaded and listened to your podcast also and it is AWESOME!

    My wife and I really appreciate your words of encouragement on our blog also.



  2. […] Pay Off Debt – Part 5 @ Joseph Sangl. I have seen so many people calculate their Debt Freedom Date and get all fired up about attacking their debt. They sell everything and everyone in sight. […]

  3. Daniel on September 27, 2007 at 10:12 am

    I was in Joes class last night, and I am fired up! I am on the attack!! Just calculated my debt freedom date and it’s liquidation time. E-Bay here I come! Thanks Joe, you rock!!

Leave a Comment