Zero Down Your Debt. Greg Johnson

putting more of our income toward interest each year than toward our own retirement savings! When you really think about it, that’s absurd. With those figures, it’s no wonder so many Americans struggle to make financial progress1.

      While being in debt may seem “normal,” we barely comprehend what debt actually means for our lives. We’re so used to it hanging around our necks, we’ve grown numb to its effects. We don’t have the foggiest idea what it’s costing us.

      At least, my husband and I sure didn’t… until we finally dug into our debt.

      Our Battle with Debt

      TRUTH #1:

      Debt is the single biggest obstacle standing between you and the life of your dreams.

      How do we know? Because we lived it.

      For years, we muddled through a normal debt-filled existence. We had a house (with a mortgage), two cars (with car payments), and regular jobs (with student loans). To top it off, our spending was out of control.

      Like most people, we never really noticed our debt. We were making a nice living, but we couldn’t seem to save a thing… nor did we really care. At the end of the month, we paid our bills but never stuck a dime into our savings accounts.

      We had gotten comfortable with our debt. Paying it off was just another part of everyday life. It was there and we knew it, but we didn’t grasp what it was costing us.

      About that time, going to work became a chore. Jobs we once enjoyed were suddenly becoming more and more of a drag. And, why wouldn’t they? We weren’t working so we could live the lives we wanted. Instead, we were working simply to pay back our debt.

      We had to make a change. Our time in the funeral industry taught us that life is precious. We were giving up our precious time – our lives – to earn money that belonged to our debts, not to us. In essence, we weren’t just wasting our money; we were wasting our lives.

      So, we pored over our bills, totaled up our debts, and examined our spending habits. We recognized we had a problem. After adding it all up, our total debt (minus the house) was came in around $50,000. We made the immediate decision to pay it off and never go into debt ever again.

      Over a period of 18 months, we cut back on our spending, used the extra money to aggressively pay down our debts, and ended up destroying every debt we owed but our mortgage.

      Finally, we could breathe a small sigh of relief. Our debt was gone, and we felt like we’d hit the lottery. Instead of shelling out thousands of dollars a month toward our debt, we were able to save that money and do with it whatever we pleased.

      The Power of Your Paycheck

      Want to know the biggest key to getting out of debt and building wealth? Chances are, you have everything you need – you simply don’t know it yet. That’s right: Your most powerful wealth building tool is your own paycheck.

      It seems obvious, right? But it’s absolutely true. The key to growing wealth is earning money. And for the vast majority of us, that means earning a paycheck.

      TRUTH #2:

      Your paycheck is your most powerful wealth building tool.

      Unfortunately, too many of us are quick to dismiss how powerful our paycheck actually is. We think we don’t earn enough, and we convince ourselves that we need to earn more money if we ever hope to get ahead. But the vast majority of the time, nothing could be farther from the truth.

      In reality, we simply haven’t figured out how to harness our paycheck’s power…yet. Instead of using our income in service of our own true goals, we buy things we don’t need or even want. Worse, we finance these purchases with money we don’t have, undermining the power of our paycheck by shackling it to the service of those debts. Here’s another truth that took us a while to grasp:

      TRUTH #3: Debt is the enemy of income.

      Racking up consumer debt is the fastest way to destroy your income and the ability to build wealth that comes with it. But it’s not just the debt itself that hurts. It’s the fact that you don’t realize how much your debt is really costing you.

      When you use debt to finance a purchase, the true cost of what you’re buying never sinks in. You put off the pain of purchasing until later. And, when you do it over and over and over again – financing everything from cars to education to furniture – all those monthly payments add up and chip away at your ability to save. Chip, chip, chip. Month after month after month. After a while, instead of working to live, you’re working just to pay back debt.

      “Racking up consumer debt is the fastest way to destroy your income and the ability to build wealth that comes with it. But it’s not just the debt itself that hurts. It’s the fact that you don’t realize how much your debt is really costing you.”

      There’s nothing fun about schlepping away 40 hours a week so you can turn around and hand over your money to somebody else. But, when that money is yours to keep, everything becomes a lotmore exciting.

      Instead of getting your paycheck and thinking about all the things you need to pay with it, you start dreaming about all the things you can do with the money. Rather than thinking, “Well, this needs to go toward the car payment,” your thoughts change to, “I’m going to use this money for a trip to Mexico.” You stop seeing life as a series of “must-dos” and start looking at all the possibilities life presents.

      It’s an incredibly freeing feeling, and it’s one you can experience by following the ideas in this book.

      By protecting your paycheck, you protect your life.

      Using the Golden Rule to Build Real Wealth

      Perhaps you’ve heard this one before. It’s called the “Golden Rule”…but it might not be the rule you’re thinking about. Here’s how it goes:

      TRUTH #4: He who has the gold makes the rules.

      Growing up in your parents’ house meant you had to follow their rules. Since your employer controls your paycheck, you have to play by their rules. When you owe money to a lender, you guessed it, the lender makes the rules.

      Think about this for a minute: Right now, you’re trading your time – your life – to make money. But, when you’re in debt, part of every paycheck you bring home literally belongs to somebody else. Every. Single. Month. That means you’re giving up part of your life to somebody else. You’re not just trading your life for money, you’re trading your life for debt. You owe, so you give up control.

      That’s not all. Borrowing money isn’t free. Lenders don’t just loan you money out of the kindness of their hearts. You’re not just using your life to pay back the sticker price of those items you financed – you’re using it to pay interest, too. Debt costs you more and more, often without you even realizing it, killing you softly with each monthly payment.

      When you’re debt-free, you get to choose how you spend your paycheck. You have the ability to take risks and live life on your own terms. You are in control of your money and your life.

      Get out of debt. Make your own rules. Become “the man with the gold.”

      9 Specific Reasons Debt Sucks

      Greg and I have grown to hate debt so much that we could list thousands of reasons you should avoid it like the plague.

      Here are some of the most important.

      •Debt is the enemy of income. Your paycheck is the most important wealth building tool you have. When you’re forced to pay off debt each month, part of your income – sometimes even most of it – is already spoken for. Debt hacks your paycheck to pieces, and with it your ability to build wealth.

      •Debt makes it hard to get ahead. Debt effectively decreases your income, making it that much harder to make financial progress. When you’re shelling out thousands of dollars to creditors each month, it’s pretty freakin’ tough to look past tomorrow’s bills. And when you’re living paycheck