Note: This is a post from Adam Baker, founder of Man Vs. Debt.
In Episode 3 of the new podcast, we cover the “6 Phases of Debt Reduction.”
Having talked to thousands of people (on all different parts of their debt journey) over the last few years, I’ve noticed a couple patterns that have emerged.
It seems that almost everyone, regardless of income level, country, or age, goes through 6 clear phases when taking back control of their financial life.
Listen to Episode 3 here!
You can also download the .mp3 file here; simply right-click or option-click and choose “Save link as.”
What We Can Learn From The News:
At the beginning of each podcast, I cover three news stories from the past week. We attempt to have a little fun and pull out a positive nugget from each story featured. 🙂
- Story #1: The Most Unusual Job Interview Questions of 2011
- Story #2: NBC’s Super Bowl Ads Sell Out at Record Prices
- Story #3: If you think Suze Orman’s new Pre-Paid Debit Card is a bad idea, you’re an “idiot”.
I also pointed out what was the best Super Bowl ad last year (by far): Young Darth Vader.
The 6 Phases of Debt:
- Free Your Mind… (I show off my singing voice – can’t miss it)
- Wake Up!
- Suck it up and Budget.
- Stop Buying Crap.
- Earn More Money.
- Bringing it all together (for the long-term).
Help the podcast reach even more people!
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Which phase of battling debt are you in?
11 thoughts on “The 6 Phases of Debt Reduction — Episode 3 — Man Vs. Debt Podcast”
I think I’m at almost all stages right now, except that I’m out of debt, so my situation is very different! I was out of debt except for my mortgage as of February last year, when I was laid off from my job. A few weeks later, my beloved only aunt passed away. My father, her sole heir, decided to divide up her remaining savings between me and my 3 brothers. End result: my mortgage was paid off last March. While I’m now completely out of debt, I still struggle with budgeting and earning more money, now that I’m not fully employed. I have been drawing unemployment compensation since my layoff, and about 3 months ago I landed a part time job in my field. I’m going back to graduate school to get a master’s degree (in library science, which is I think what I should have done 20 years ago, in retrospect, but the past is past, all I can do is try to make the best choices for myself now). I know that overall hiring in library science is very depressed right now, and as with most public jobs the prospects aren’t great until the economy recovers (but that’s every job category, not just the public ones), but I feel confident that this is the right career for me, and I will make it work somehow. So, earning more money is important, but I want experience in my field more than I need to make extra $, since my debt is gone and the important thing right now is to re-career, not just to find stop-gap, dead-end jobs delivering pizza or whatever.
Thank you for another great show.
I am at the “Suck it up and Budget” phase. I really enjoyed hearing this episode and it got me motivated to really get my rear in gear.
Thank you again.
Hi Baker, thanks again for a great podcast, really enjoyed this episode.
Right now, I would say I am hovering between ‘suck it up and budget’ and ‘stop buying/start selling crap’. I am trying to figure out a way to use the envelope system but my bank recently changed their policy regarding cash deposits so I have to experiment with digital envelope systems and find one that is easy and will help me stick to my goals.
I havelaid out a few rules for crap-buying for myself:
a) it should go on a 90 -day list (30 days is too short for me)
b) money should follow behaviour and not the other way around (ie. don’t invest tons of money in a shiny new bike if you have never biked before, borrow one to try it out if you can)
c) buy second-hand.
So far this little abc is very helpful for cutting back on the crap. One area I still struggle with are cutting expenses on experiences and services (eg Yoga studio, meditation class, skating lessons).
Annnd I have succesfully sold my first batch of crap on eBay!
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Enjoying the podcast, and want to support it & help keep up the momentum – so a suggestion to that end – shorten your first segment on news stories (it took up the 1st 15 minutes of the latest episode), make the beginning snapier & get right into the meat of the show
I’m one of those obnoxious people who never really got into debt. I’ve always been careful with my money because in my mind, money = freedom. I’m not talking about having millions of dollars but enough to pay my bills, have an emergency fund, and not be in anybody’s debt. That being said, I am no where near the point of not having to work. I still drag myself into work every morning and wait anxiously for 5pm.
This all puts me squarely in stage 5.
I need to get off my butt and figure out how to earn some more money. This way, I can pay off the house faster and not need as much income in the future.
I have an idea for earning more income, I’ve identified a need and know that I can fill it. It’s just a matter of getting past inertia and taking that very scary leap.
Thanks for the podcast, it helped to consolidate my ideas on what I’m doing to get my life under control. Now I just have to learn how to communicate why this is important to my partner, who is on phase zero!
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Thank you for the reminder that it will take time as I work through this…thank you for the inspiration/motivation!!