How To Reduce Your Debt

Reduce Your Debt

The Debt

There can be almost no doubt about the fact that debt can be considered a roadblock to creating wealth over a long time. Any kind of debt like home loans or personal loans, credit card debts etc. are huge disadvantages to have on one’s side when we are on our eternal campaign of wealth creation.

Among all the mentioned kind of debts, home mortgages are most often unavoidable due to the huge capital requirement for the purchase. But since mortgages are for very long terms (generally more than 10 years) they offset some of the debt over longer term due to the effects of inflation on currency.

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OK so after home loans out of the picture now let’s concentrate over rest of the debts.

After reading through various posts which guide us on reducing debt I can say not May posts are available on what exactly to do on a priority basis to start.

Debt exists when there is the negative difference between income and expenditure. When we spend more than we generate income we have a debt. Or in other words, whenever we are “Living Beyond our Means”.

So the question we need answer ourselves is – “Can I afford this expense without affecting or burdening any other financial commitments which are important in our lives?”

But … a very important question we always need to ask ourselves… Can I afford this?

OK, many people would have a much different understanding of this question here so let us put one condition that will enable us to answer better on this question.

And that condition is – “without majorly affecting or burdening any other aspect of our financial life”


Identify Debt

In order to identify the expenses that have the most draining effect on our income lets list the largest monthly expenses that are true for most of us.

  1. Accommodation
  2. Food
  3. Travel
  4. Entertainment


Accommodation Expenses:

So as we see accommodation as a top most expense for most who don’t yet own a home.

I know that everyone likes to have bigger, luxurious, posh properties in top neighborhoods.

Even when living on rent we tend to like the most stylish and comfortable homes.


If you are living on rent you have some options which you can choose –


– Sharing accommodation

– Moving to a cheaper rental property (be assured you can find one if you have the will and some patience)

– Staying with your parents if you tend to work and live in the same city. If you have to travel a little more from workplace do it. Believe me, it will save you a lot of this small sacrifice of your time and effort.

– Find a second income source to fund your debt if you couldn’t do any of the above.


Food Expenses:


This is simple. Have home cooked meals with only occasional eat outs.

It’s healthy, hygienic and cheaper in your pockets.

Don’t you know how to cook? Well, Google has helped on hand, try YouTube.


The whole idea is either you take out some time and efforts to save on some of the debts or be lazy and forget about it.

To achieve anything you’ve got to put in the effort.

The plus side of it is that you’ll learn some skills for the lifetime apart from reducing your expenses.


Travel Expenses:


  • Use Public transport as much as possible to save on the travel costs.
  • Carpooling is a good option to save on fuel and also contribute to environment conservation
  • Buy less fancy cars. Remember the basics behind any cars are similar.


Wheels, engine power, Air-conditioning, safety measures etc. If these are as per your requirement than anything else is just a show-off. If you have a small nuclear family, you don’t need a big “hummer”. In around a city or for office commute, a small car for city drivers would save you a lot of money. Remember we are in debt here. So we have to cut on our expenses in all ways possible.



Well in today’s world there no dearth of ways to get entertained. So choose wisely and in a cost efficient way.

I’ll cover more on debt later so see you till the next post which should appear shortly on the website.

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Reduce debt, live a simple life and you will be happier.


Author – The Wise Zone

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