There’s a rule in private economy that cannot be compromised. A rule that should be written on your bathroom mirror, on your phone lock screen, on your fridge:
GET OUT OF DEBT.
Debt is not neutral. Debt is not “just how things are.” Debt is a silent weight. It doesn’t rest. It doesn’t sleep. It doesn’t forget. It grows — daily — and it grows against you.
Some debt can be useful, in very controlled conditions. But the kind most people carry? That’s not strategic debt. That’s financial bleeding.
Understanding the Two Types of Debt
1. Debt for Investment
This is the kind of debt that can (in theory) grow your net worth. Think:
- A mortgage for a home that appreciates in value
- A student loan that leads to a high-paying career
- A loan to launch a business with clear cash flow potential
Example:
A professional takes out a $15,000 loan to get a certification that raises her income from $50,000 to $80,000/year. That debt is tied to a measurable return.
But even here — investment debt is not a guarantee. Houses can lose value. Businesses can fail. School doesn’t always lead to income. You must run the numbers and have a plan.
NOTE: Investment debt is for companies and professionals. If you’re not in that position yet, it’s not your current game.
Let’s focus on the real threat most people face.
2. Debt for Consumption
This is the killer.
- Credit card balances
- Buy-now-pay-later schemes
- Personal loans for vacations, electronics, clothes, restaurants
- Car loans on vehicles you can’t afford
- Financing “wants” instead of needs
Example:
You put a $2,000 vacation on a credit card at 22% interest. You make minimum payments. After 5 years, you’ve paid over $3,800 for a trip you barely remember.
This is money that doesn’t build your future — it robs it. It’s not an investment. It’s lifestyle inflation funded by borrowed time.
The Debt Trap
Here’s how it happens:
You want something now, but don’t have the cash.
You swipe a card.
You make a minimum payment.
You do it again.
Eventually, the interest becomes its own bill.
You borrow more to stay afloat.
The cycle deepens.
You wake up one day, and realize your income belongs to someone else.
You don’t own your money anymore — your creditors do.
So What’s the Plan? How Do You Get Out of Debt?
1. Get Radical with Reality
List every single debt you owe:
- Lender name
- Total balance
- Interest rate
- Minimum payment
- Due date
- This is your enemy map. You can’t fight blind.
2. Cut the Bleeding
Stop using credit. No exceptions.
Cut the cards, delete the apps, block the sites.
You cannot fix a hole in the boat if you keep drilling more holes.
3. Build a Bare-Bones Budget
Budgeting isn’t about spreadsheets. It’s about priorities.
- Rent
- Utilities
- Food (basic)
- Transportation to work
- Minimum debt payments
Everything else is optional — and probably has to go for a while.
Example:
You cancel Netflix. Stop eating out. Delay upgrades. You free up $300/month. That $300 goes to destroying debt, not improving lifestyle.
4. Choose Your Payoff Method
Snowball Method:
Pay off smallest balances first. Build momentum.
Good for psychology.
Avalanche Method:
Pay off highest-interest first.
Best for saving money long-term.
Example:
You have:
$400 on a store card (25% interest)
$2,000 on a Visa (22% interest)
$7,000 car loan (8% interest)
You could:
Snowball: Pay off the $400 fast, feel a win, then tackle the Visa.
Avalanche: Start with Visa — it’ll save you more money on interest.
Either is fine. Pick one. Stick with it.
5. Increase Your Income
You can only cut so far. At some point, you need to make more money.
- Take freelance gigs
- Sell things you don’t use
- Work weekends
- Learn a new skill that pays
Example:
You drive Uber on weekends and make $500/month. That’s $6,000/year toward your debt. That’s a weapon.
6. Automate and Track
Set up automatic payments for all minimums.
Then manually add your extra payments each week.
Track your debt balance weekly. Watch it drop. That builds momentum. That builds belief.
You Are Not a Victim — You’re in a Fight
Yes, maybe you weren’t taught about money. Maybe you’ve been hit hard by life. That’s real. That’s painful. But it’s not permanent — unless you let it be.
Every day you wake up, you choose:
Stay in debt or get out.
There is no neutral ground.
Debt doesn’t disappear.
Debt doesn’t forgive.
Debt doesn’t feel bad for you.
You either work for your freedom, or you stay someone else’s asset.
You don’t have to be perfect. You have to be consistent.
You don’t have to fix it overnight. You have to fix it every day.
Final Words
Getting out of debt is not glamorous. It won’t go viral on social media. It won’t impress people at parties. But it will:
- Let you sleep at night
- Give you control of your life
- Free your future income for things that actually matter
- Break the cycle
Private Economy Rule #1: Get Out of Debt.
Make that decision. Then make it again tomorrow. And the next day.
Until you’re free.
Download templates for your new budget click here.