How To Get Out Of Debt Without Feeling Like A Poor Person

You lay in the dark, eyes wide open.

You work the numbers in your head… the money you make, the money you owe…

You see NO way out of the mess.

You can taste the dread, like phlegm in the back of your throat.

I’ve had periods of my life where I was so deep in the red, I had NO idea how I’d claw my way back.

Several years ago, one of my business failures put me and my family in deep financial shit.

By the time I stopped the bleeding I was six figures in debt, much of it due in full within the year.

I had no cash and no liquid assets.

To top if off, my income was ZERO.

When you are drowning in debt with no capital or income to work with, you have TWO levers available:

1. Cut expenses

2. Grow income

I did what most men in my situation would do: I pulled the first lever and cut our living expenses to the bone.

I cancelled cable (and sold the cable box).

I cancelled my cellphone plan and went prepaid instead.

I got us eating beans and rice.

I scrutinized every transaction we made and argued with my wife about purchases I deemed unnecessary.

And you know what?

I felt like absolute shit.

Our expenses DID go down… but it cost me:

I felt small-minded.

I felt grabby.

I felt POOR.

I realized I had cut costs so hard and so deep… I was actually cutting into my earning capacity…

…destroying the very creative thinking required to grow my income and get us out of the hole we were in.

Yes, cutting costs has its place. But it’s reach is finite. You can only cut expenses so far.

Your income potential, on the other hand, is INFINITE.

Cutting expenses is easy and direct and “feels” effective.

That’s why I started there.

But once I realized how dangerously deep I’d cut… how close I’d come to killing the fire that would save us… I quit the cutting and faced up to the REAL WORK ahead of me: INCOME CREATION.

I knuckled down and got laser focused on my top three to five income opportunities.

After 8 months of busting ass… we were back in the black.

Looking back, here’s what I would have done differently:

1. Take action within 30 DAYS of financial upset

The business I ran at the time was feast or famine by nature, so when my income dried up, I didn’t think much of it.

When I finally realized the income wasn’t going to bounce back, I’d already gone MONTHS without reigning in our overhead… a move I should have made within 30 days of the upset.

It seems obvious now, but at the time I was blind to how deep a hole I was digging… and how quickly I was digging it.

2. Cut expenses by 20%, then PUT DOWN THE KNIFE

Cutting expenses should be a quick, brief step along the way. It is not the ultimate solution. And if you cut too deep, you will kill your inner money maker.

Just cut the 20% of expenses that impact your earning capacity least.

For example: Cut the club membership you never use, NOT the organic food that gives you a strong body and a clear mind.

3. Do the scariest shit you can imagine for two hours a day

When you work to grow your income, do not waste your time on linear activities with linear outcomes.

Ask yourself “what is the highest, most terrifying use of my talent? What ACTIONS applied to what OPPORTUNITIES could unlock massive value in the market… and in turn unlock commensurate income for me?”

Then DO THAT like a fucking berserker.

It doesn’t matter if you owe $10K or $10M.

It’s all relative.

Your income is only limited by your imagination and your execution.

Bottom line, you can’t shrink your way free.

Cut the easy shit, then tackle the REAL work of financial liberation: JACKING YOUR INCOME via courageous, inspired execution.

Put down the machete and pick up the wand:

You can’t chop your way out of this one… you must CREATE your way free.

Comments

  1. Thank you, I needed to read this.

  2. anthony wareing says:

    I’m no I’m no longer in debt. But even now I could be generating cash outside of my job. To build up the nest egg we never had. I just rely on having a regular job. Only words at this stage but I feel you’ve motivated me to pull my finger out and earn more for my family.

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