Guest poster, TD Bank, shares some tips with us today about financial freedom. Making some of these changes may not be easy, but taking some of these steps will head you in the right direction to becoming financially independent. Molly

Getting out of debt is the first step to becoming financially free. Whether you’re trying to pay off student loans or a mortgage, debt may seem impossible to evade.  Check out these “6 Tips to Dodging Debt and Reaching Financial Freedom.”

1. Face the Problem

- Collect all of your statements and calculate your outstanding debt (the total amount that needs to be paid).

- Helpful hint: Consider the finance rates for each debt that you have and make note that paying the ones with the highest rates first will save you money in interest charges.

2. Evaluate Your Expenses

- What else are you spending money on that is making it more difficult to pay off your debt? Daily coffee runs and going out to lunch instead of packing a lunch are small costs that can add up.

- Separate your “needs” from your “wants”. Cut down on the frequency of “wants” purchases in order to fulfill your “needs” and contribute to paying off your debt.

3. Make a Plan

- Create a realistic and reasonable budget-plan.

- Make deadlines for yourself and stick to them. Create a realistic timeline as to when you will have one bill paid off and then start saving your money for something else.

4. Save, Save, Save!

- In addition to the money you are using to pay off your debt and spend on your “needs”, it is important to put some money away in savings each month.

- When you’re ready, consider investing some of your savings. Stocks options, bonds, CDs and mutual funds are some investment options you may find beneficial.

5. Reward Yourself

- Paying off debt can take a lot of hard work and discipline. Continue to save and follow your budget-plan but don’t forget to live your life while doing so.

- Reward yourself for reaching a specific deadline or accomplishing a goal. Spend a night out with friends or upgrade one of your electronics. You deserve something for your hard work but don’t get crazy!

6. Know Where you Stand

- Regularly review your plan and understand that it doesn’t need to be set in stone. Life doesn’t always go according to plan and you may need to make adjustments along the way.

- Always know how much of your debt you have already paid and how much more you have left. Keeping track of your progress will help motivate you and will only bring you closer to becoming debt free and financially independent!