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  • Writer's pictureMichael Eggebrecht

Debt kills dreams

The other day I was in the middle of a coaching session with one of my current clients and I asked, "Where do you see yourself in a year?". This was a wide open question and it got emotional for this client. It has been a difficult year for her and she is starting to get some traction with her debt and she is starting to see what debt elimination can do for her, what doors it may open. The discussion was awesome as I saw her start to dream out loud as to what her dreams look like - career, family, relationships, etc.


After the coaching session, it dawned on me that debt has the capacity to really kill our dreams. It does this in so many ways. Debt is that chronic stress in the back of our minds. It can stress our relationships, keep us from seeing what the future can look like and even lead to insomnia - I have seen this. Carried even further, debt can lead to health issues related to anxiety, poor sleep and poor self care. As a family physician, I can't help but wonder how many of my former patients over my 3 decade career were dealing with stress related health issues that were at the core caused by debt.


So, the big idea today is that debt kills dreams. Take inventory of what your debt picture looks like and even take time to write down or journal what impact the debt is having on your whole being. Once you can see on paper what the debt is doing to you, you can map out a plan or a solution to it.


Here is how I think about approaching debt:


  1. Write down all of your debts and exact balances of each on paper or a spreadsheet from lowest balance to highest balance. Also, write out the current interest rate being paid on each

  2. Write down the minimum payment on each and when they are due

  3. Write out your budget - there are so many online tools to do this for free or little cost - YNAB.com, Everydollar.com and Goodbudget.com are a few good options and are fairly intuitive. You can even just use a spreadsheet as well.

  4. When you set up your monthly budget, you are telling your money where it will go every month. Make sure that you log all of your income and expenses in your budget whenever there is a transaction. Tracking is really the thing that makes a budget effective.

  5. After you set up your budget, including expenses for your debt minimum payments, you will be able to determine if you have any extra money to put toward your debt.

  6. Finally, you can either follow the debt snowball method or the debt avalanche method to eliminate your debt. With the debt snowball, you put extra money toward the smallest debt each month until it is paid, then you move to the next largest debt until it is paid, etc. With the debt avalanche you take the same approach except you go after the highest interest debts first, then the next highest, etc.


No matter how you slice it, debt kills dreams, AND likely affects your whole being and relationships. Today is a great day to turn the tide. Once you get some momentum eliminating debt, you will gain confidence and you will start to dream what the future could look like!


If you would like to have any assistance with what coaching could do to fast forward this process, feel free to reach out to me for a free consultation.

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