Reduce Debt Increase Wealth.com. welcome and Mr. Chuck here. Today I'm going to talk about reasons why you should get out of debt. I know I talked about it in the past, but maybe I came up with two or three of these reasons I found an article on the internet that has 17 reasons. So that's probably cuz I'm a truck driver and I can't think of all the reasons so here we go. But first, here's a reminder, have you know what your checking account balance is? Have you projected your expenses forward? Are you putting money into your savings account? Have you build up your emergency fund? So if you hadn't done that, you gotta keep at it. I almost forgot to put that in this episode. So here we go. And here's the article. Get out of debt. 17 reasons why you should get out of debt. benefits of being debt free. I found this money crashers.com Bye. Amy Livingston. That is a common fact of life in America today. According to 2015 report from the Pew Charitable Trust, roughly eight out of 10 Americans have debt with an average of $67,900 per person. The report also found that Americans feel conflicted about their debt. Nearly 70% of the respondents said they would rather not have that, but they see it as a necessity. And a similar percentage feel that loans and credit cards have given them more opportunities in life. Those conflicted feelings reflect the fact that debt can be both good and bad. Good debt is usually is a useful financial tool, helping you to do things that will improve your finances in the long run, such as going to college buying a home or building a business. By contrast, bad debt such as credit card debt, just weighs you down with the interest payments while doing nothing to increase your income. This in turn makes more To put you more dependent on borrowing to get through the month, tapping you in an endless cycle of debt. Being stuck in a debt trap ties up your money, so you can't do all the things you'd like to do with it. However, its effects are far more than just financial over time. That constant pressure of debt can also damage your work health and relationships. freeing yourself from debt can make your life better and just about every way, financial benefits number one more free income. When you carry in a lot of debt, the payments on that debt ties up a big chunk of your income. For instance, suppose you have a 30 year mortgage for 200,000 at four and a half percent interest. The payment on that mortgage would eat up $1,013 of income of your income each and every month, and nearly half of that would go towards interest, not building actual equity in the house. If you can find a way to pay off that debt early suddenly you have more than thousand dollars of extra income available every month. That's more than two 12,000 each year that you could spend on other things that matter to you, you could treat yourself to that kitchen remodel you have always dreamed about devote more money to your favorite hobby, or go on a fabulous vacation each year. Number two, earlier retirement. Another thing to do with the extra money you say by paying off your debt is to put into other investments. If you're not putting enough into your retirement account right now that extra cash can means the difference between retiring at 65 or having to work into your golden years. If you're already maxing out your retirement contribution, putting the money and other investments investments could help you reach financial independence and be able to stop working even earlier. Three less risk. One of the worst things about being in debt is the risk it brings into your life. If you're already in debt and have no emergency savings to fall back on you already just one financial blow away from disaster. A job loss or a major medical crisis can leave you unable to meet the payments on your debt, which could result in constant calls from collection agencies being sued for non payment and possibly having your wages garnished. Having your car repossessed losing your home due to foreclosure or being evicted because you can't pay your rent, bankruptcy. being debt free removes these risks. It gives you a budget room to breathe so you don't have to worry about a single unfortunate event ruin your financial and personal life for a better credit score. Carrying a lot of debt really weighs down your credit rating. The closer your credit cards and loans are to limit the lower your score will be. A bad credit score can cost you $1,000 a year and higher interest rate and make a harder escape from your debt trap. The flip side of this if you pay off your debt your credit score will improve. This in turn can offer why weighing two potential benefits, better interest rates on anything Future loans, lower insurance premiums, a better chance of landing your dream job since employers often check credit scores to see if a potential employee is reliable. a better chance of finding an apartment since landlords sometimes do the same, better deals on cell phone service. Five, better job prospects. Being like being in debt can also hold you back at work. worries about money can keep you up at night, which makes you less productive on the job the next day. If you reach the point where you have to deal with debt collectors, the problem is even worse, they likely call you up at the office interrupting your work and impairing your productivity. Debt collectors can even contact your employers directly in an effort to locate you an embarrassing situation and constrain your relationship with your boss. By contrast, paying off your debt makes your job more satisfying. You feel a lot more motivated to work harder when you get to keep the money you make, rather than spending it on debt. Pay. And if you've been stuck at a job because you hate because you need the money to pay those credit card bills paying off the debt frees you to look for a new job that's more rewarding. Six less stress. Living with debt is a major source of stress. You worry constantly about how you're going to pay all the bills and what could happen if you lose your job. That constant pressure and having to work to pay off debt, while feeling guilty about spending on even the smallest of pleasure grind you down at 2013 study at Northwestern University found that the young adults aged 24 to 32 with high levels of debt report it overall stress levels about 12% higher than average. Other studies have found that even stronger effects for instance, in a 2001 life events inventory created by this society occupational medicine which ranked 100 life event based on how stressful they are getting into debt and beyond. repayment came in fifth, it was related more stressful than losing your job, getting a divorce or becoming temporary homeless. Getting rid of debt is like lifting a huge weight off your chest. If you no longer feel trapped, you're you're you're constantly running into a hamster wheel. You can sleep more easily and your thoughts no longer locked into constant pattern of worrying about money. You can devote more energy to work family, friends and pastimes you enjoy. Seven better mental health. Stress isn't the only mental health problem that's linked to debt. The Northwestern study found people as lots of debt are 13% more likely than average to report symptoms of depression. A 2014 study published in the Journal of Gian Jiro tala G Series B. Found a similar effect for our adults over 50 in this group have an unsecured debt that is debt does not Backed by assets, such as a house or a car at a strong link to depressive symptoms, and the higher the amount of debt to work those symptoms, the worse their systems were likely to be at its most extreme deck and even lead to suicidal tendencies. At 2012. Huffington Post story reports that people struggling with overwhelming student loan debt, often struggle with thoughts of suicide, and few have actually taken their own lives. The fortunate flipside of this is being debt free improves your mental health, you're less likely to suffer from anxiety or depression, and more likely to be happy with your life as a whole. A 2014 study at Purdue University found that lower debt levels of debt play almost as big as role as higher income people's overall levels of happiness. It's a great feeling to know that you own a car house free and clear and no one can ever take it from you. Eight higher self esteem babies Debt can eat away at your self esteem psychologists and debt experts interviewed by Fox Business a people with that often go out of their way to create a life that looks picture perfect on the outside a beautiful house nice cars nice clothes, because they don't want anyone to know their real financial situation. Of course all these things cost money which just makes her financial situation worse and increased her feelings of shame. By contrast, paying off debt can boost your self confidence like magic. And the Fox Business Article One word woman relates the story of going to buy a new car for the first time after paying off 120,000 in debt. When a car salesman ran her credit check her initial response was panic followed quickly by elation does she realize that for the first time the results were actually be good. The thrill often makes people Eagles or share their stories. Other escape from that as they are anxious to hide the debt while they still had it. Nine better cognitive function And isn't just an emotional problem and can actually impair your chronic lung function, your ability to think and reason, a 2017 mega study published in frontiers in psychology points to numerous studies showing that experience and poverty both in real life and laboratory condition impairs people's attention span working memory and self control. This is a problem that feeds on itself weaker can cannot cognitive function can make you worse at making financial decisions, which can make your debt problems still worse. The frontiers in psychology paper so that financially stressed people were more likely to choose small gains, now over much larger ones in the future. They also were less adept at evaluating risk, they are less willing to take risks that could lead to long term gains yet more willing to take risks that could lead to long term losses. Fortunately, study also show that paying off debt versus the problem. A 2017 study at the National University of Singapore offered families with high big debt a big chunk of money. The equation just several months worth of income to pay it down and found that the petition to petition didn't reduce their debt there cannot be negative functions Rose significally they also felt less anxious and became better decision makers. physical benefits 10 your illness. This dress that brings can damage your body as well as your mind. The same new Northwestern University study that link debt anxiety and depression also found that people with higher levels of debt reported worst physical health overall, debt can damage your health in a very ways according to psychologist Carol Stovall, one of the experts interview in the Fox Business article, stress can be triggered for heart disease owlery gets touched no problems and Diabetes. a 2008 survey by associate press and AOL, health bears is out. Showing that people with high levels of debt related stress are more than three times as likely to suffer from all SIRs and other digestive problems. As people with lower debt stress, they're also twice as likely to have heart problems including are the friendliness and heart attacks. Chronic stress can support your immune system put in you're more at risk for infectious disease such as colds. On top of that money worries can keep you awake at night, further damaging your ability to fight off illness. an AP study found that people with high debt stresses with more than twice as likely to suffer from insomnia as other sleep disorders. When you pay off debt you can feel better instantly physically as well as mentally those nagging headaches and stomach aches or ease up and a better sleep and better immunity you're more likely escaped nasty viruses like Going around at the office 11 lower blood pressure. having too much debt can actually raise your blood pressure and in northwestern study, people with higher debt showed a 1.3% and diagnostic blood pressure compared to the average just may not sound like much busy enough to make a real difference in your health. increase it just two points and blood pressures raises your risk of hypertension, dangerously high blood pressure by 17% and your risk of stroke by 15%. This means paying off your debt could do more than make you feel better, it could actually save your life. A 2016 report from the Federal Reserve Bank of Atlanta showed how debt affects death rates found that people credit rating improved, so did their maturity risk, an increase of 100 points in credit risk Equifax equivalent of FICO score, reduced the overall risk of death by 4.38% 12 less pain Some studies suggest that debt can even cause physical pain at 2008 ap survey found that 44% of all people with high levels of debt related stress suffered from migraines, compared to this 15% of those with lower debt stress. They were also more likely to suffer from back pain in general muscle tension. Another study published in psychology science in 2016, found that people with high levels of economic insecurity were more likely to buy over the county counter pain pills. even thinking about financial insecurity the scientists found could increase people's pain level. subjects who had to think about financial unstable times in their lives reported almost twice as much physical pain as those who thought about financially secure period. And since the less debt you had, the less time you have to spend thinking about it, it stands to reason that paying off debt will help ease those aches and pains. 13 better prevented Care. Most health problems caused by debt are in some way related to stress. However, there's one debt related problem that's simply a matter of dollars and cents, not being able to see your doctor often enough. A 2013 study in the Journal of Health and Science behavior found that people who have high levels of credit card debt or medical debt are less likely to see a doctor a dentist regularly. Even when they are sick. These people often skip doctor visits because they can't afford to bills. On the other hand, people with good debt such as home and car loans or more, no more likely to avoid doctor visits. So that's the final way of paying off your debt boosts your health you can always afford to see a doctor when you need one. Relationship benefits. 14 better relationships being in debt stirs up a lot of negative emotion says exam anxiety and depression, fear and anger. These feelings tend to spill over into your relationship. Without her at work and at home. When you're worried about how to pay the bills, you're more likely to snap at your spouse or be short tempered with your colleagues at work. You get mad at your boss for not paying you enough and feel resentful when your friends tell you about their vacations. Since you can't afford one yourself. Getting rid of debt will make you a happier person. and that in turn will make your relationships better. You'll be more patient with your spouse, your kids, your friends and your co worker, even new people will you meet will like you more when you're not in a bad mood all the time because of that stress. 15 a stronger marriage. money problems including debt always put a strain on a marriage. Even when both partners see the debt as a problem and are working to eliminate it. The stress it causes can make them be they're more likely to be irritable with each other It can also affect them physically snapping the energy out of their sex life ever when one spouse is working hard to pay off the debt where the other keeps Spending, it's a situation is bound to lead to fights about money. One of the biggest source of tensions and marries the institution for divorce financial analysis says money problems are the third most common cause of divorce right after basic income, patentability and infidelity. The good news is that when you work through these problems together, your marriage can actually become stronger at the end. The process of paying off your debt will force you to communicate better, better, and experience a surviving a crisis together recreate a stronger bond between you 16. Being a bear better parent, paying off debt can make you a better parent in different ways. First of all, it will free up income that you can put towards taking care of your kids. If your son needs braces, your daughter wants to take up a sport you won't be able to. You won't go into panic over where the money will come from. You can also afford to save for your child's future. For example, By investing in their college education, becoming debt free will also improve your emotional state. The freedom from debt stress, it will make you more pleasant to be around and give you more energy to devote to playing tag or helping with homework. And because paying off debt strengthens your relationship with your spouse, it will create a better home environment for your kids. Finally, the process of paying debt will make you better at teaching your children about money. You can help your children learn from your mistakes by teaching them how to avoid debt in their own lives. 17 being able to help others others, getting out of debt has one more big advantage. Getting out debt has one more big benefit. It makes it possible for you to help out others when they need it. For instance, you can lend money to friends or family members who needed it to get through a tough period. If they're struggling with debt. You can also give them the benefit of your experience to help them figure it out. on how to get out sharing your success stories can inspire others and give them the boost they need to tackle their own financial problems. In addition to helping out people you know, being debt free allows you to get money to charity, happiness. Economists have found that spending money to help others is one of the most rewarding things you can do with it. It's a great feeling to know your money is helping them make our world a better place. Final Word. Knowing the benefits of being debt free is one thing, but actually figuring out how to do it is another. Fortunately, there's a lot of resources out there that can help. Start by using a debt payoff calculator such as one at Credit Karma to tally up your debts and set a timeline to pay them off. Then create a household budget through tiller that sets aside a Pacific time each month to put towards paying down your debt and make this the first bill you pay every month before you start spending on anything else. Next, look at ways can hasten your debt payoff considered debts no flaking, which involves looking for a little extra some some money of cash to put towards your debt each month. If you have multiple debts, look into the benefits of debt consolidation to reduce your interest and simplify your payments. Also compared to debt, avalanche and Debt Snowball methods, which throw all your extra money at one debt at a time to pay it off as fast as possible. If you're really desperate straits with that, try looking for outside help if you can negotiate with your creditors to reduce the balance you owe them. Consider talking to a credit counselor about setting up a debt management plan to get your debts paid off and fixed timeframe while avoiding new ones. Do whatever it takes to get that debt out of your life so you can start living fully again. Well, thanks for bearing with me. That's a very long article. I hope you got a lot out of that. One of the reasons is retirement to reduce debt. So within the next week or so I'm gonna talk more about that. Subject, I have a sponsor to try to offset some of the costs of this podcast. So that's why I like to talk about next. If you take vitamins, it should be taken isotonic liquid. It gives you rapid absorption. It's fairly easy to swallow, you get highly concentrated nutrients when which gives you the maximum benefits. It's much better than the pill vitamin, because it gets into your system at a much faster rate and more of the vitamin gets into your body where your body can use it. I've been using it for five years now. It's highly recommended it learn more about isotonix vitamins, go to my website, Reduce Debt, Increase Wealth.com, upper right hand corner, click on the heart and I'll take you to an isotonic website which belongs to my wife and help support to show thank you very much episodes are released weekly subscribe so you can follow Mr. Chuck's journey to reduce in debt and financial freedom as you do the same. If you liked this podcast, please share Transcribed by https://otter.ai