Getting Aggressive: How to manage and strangle your debt

Saving money hardly is a one dimensional as it sounds.

Sure, you can look at saving money as the simple act of putting aside what is leftover after you pay your bills and thus build a savings account, emergency fund, all the while thinking about retirement and how you’ll spend your golden years (either still working or managing money like a professional).

But saving money goes beyond just simple subtraction of expenses versus income and instead can center on another key contributor to your finances: debt, and more importantly, paying it off completely.

The real disappointing aspect of debt is the perception of it, so before you consider paying it off in full, how do you really see debt as a whole? Most view debt as a necessary evil and something that everyone has.

You could argue, however, that some individuals want nothing to do with debt whatsoever and work diligently and tirelessly to rid themselves of it or not have any at all. They do so not because they’re rich but because they live within their means and don’t overspend or buy impulse items.

Remember, if you use the 24 hour rule, chances are you won’t be spending on what you don’t need. The 24 hour rule says if want something leave it at the store or don’t add it to your cart until you wait 24 hours, and if you still want it after that “impulse” has run its course then so be it, but nine times out of 10, you’ll be glad you didn’t jump in head first but rather dipped your toe in the water first.

Managing debt is not only avoiding it altogether but coming up with a system to pay off what you owe. The same bet is to start small and work your way toward bigger balances, so that you have that feeling and sensation of actually paying off cards and lines of credit, then moving on to the larger ones and so on and so forth.

A good debt to income ratio leads to a better credit score and with a better score you’ll have the inside track on interest rates that can’t be beat, and for example, a 30 year mortgage with a few interest points knocked off because of your lack of debt and better than average or below average credit score gives you a rate that saves you thousands over the course of the loan.

If you don’t believe debt and doing right by it makes a difference, ask someone with a sub 600 credit score or who is spending 60 to 70 percent of their income on credit cards, and you’ll quickly see that debt isn’t an isolated financial responsibility or factor but rather affects your entire outlook as far as saving money goes.