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Working in healthcare can be stressful enough, but with student loans, credit card bills, auto loans, and other debt looming over our heads, we’re carrying too much baggage to care for patients and ourselves properly. It’s time to get out of debt – STAT! Let’s take back control this year.
According to a recent Motley Fool survey, the top financial New Year’s resolution is paying off debt, followed by saving for a significant financial milestone.
Below, I share 5 steps to help you become debt-free so you can live the life you deserve. So, buckle up and let’s get started!
Step 1: Assess Your Debt
Just like we do starting a shift – Assess! Before you can become debt-free, you must assess where you stand and know exactly how much debt you have. Write down all your debts. Be sure to include the amount owed, the interest rate and the minimum payment. Once you have a clear understanding of your debt, you can start making a plan to pay it off.
Step 2: Budget for Value
I know the term budget feels restrictive and can sometimes have a negative connotation, but think of it as a care plan, a checklist, your guide to getting out of debt. Essentially, review your spending habits and cut out unnecessary items you don’t use or don’t bring you value.
Is daily Starbucks important to you? Great! Keep that. Hulu subscription you rarely watch? Cut that. The key is knowing exactly where your money is going and only spending it on what you value. The rest goes towards that pesky debt that’s holding you back.
Step 3: Automate Your Money Moves
Building off our assessment and budget, the next step is to automate your money flow. This flow includes everything from your checking account to debt payments, building up an emergency fund, investments and other expenses. Automating your finances is likely the strongest way to accelerate your debt payoff and eventual wealth growth.
Knowing exactly where and when your money is going is one of the best things you can do in your personal finance journey. Take some time to organize and outline your money flow.
Step 4: Increase Your Income
Although picking up extra shifts is a quick and easy way to make additional income, it may not be sustainable for your physical and mental health. It’s all about balance. So, seek alternate ways to make money that might be easier for you, such as picking up a part-time remote job, negotiating a raise, or starting a side hustle.
This step isn’t a quick fix. However, you can spend some time reviewing your skills, building new ones and applying them to future opportunities to increase your income. Any extra money and skills you develop will help you pay off your debt and grow wealth in the long run!
Step 5: Coaching
A few coaching sessions to review the plan we created above are super important. A financial coach can review your plan, clarify pressing questions and, most importantly, hold you accountable. We all know how important accountability is when working on a goal.
If you don’t have access to financial coaching through your employer, we recommend flat-fee financial coaches or planners. Being charged for each session is far less expensive than being charged for assets under management, which many financial advisors do. When I tell you a $100 coaching session can literally save you hundreds of thousands, I mean it!
Get Started Now
The road to becoming debt-free takes time, dedication and hard work. But, as a healthcare professional, you’re no stranger to hard work! Follow these 5 steps, and I promise you’ll see yourself on the path to financial freedom.
I want to leave you with two free resources:
- Pathway to Prosperity follows many of the steps and points made above.
- Digital Financial Plan gives you a financial health report, action items and additional resources to help you on your journey.
Good luck, and feel free to reach out to Investhealth to let us know how we can help!
View the full schedule of HCP Wellness Week live events, resources and giveaways to take advantage of all the offerings throughout the week.
