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The Millionaire’s Guide to Being Debt-Free A lot of people dream of being a millionaire, envisaging themselves coming out of grand limousines in stunning attires and ensembles just like those Hollywood actors in their dazzling demeanor. Of course, by “millionaire” we do not refer to those who are born with a silver spoon in a royal family or who have grown wealthy overnight by virtue of some propitious inheritance. A good number of millionaires are usually those who have risen by virtue of hard work, following one’s dreams and determination. They had very humble beginning and most of them had one key to their success – that of keeping out of debt. How to Become Debt-Free – the Millionaire’s Way Understanding Debt Anthony Manganiello – the author of the recent bestseller “The Debt-Free Millionaire” says, “Debt is the difference between generating wealth and accumulating wealth. The more you continue to commit to future income for past purchases and pay interest on those purchases, you will be consuming your wealth before you’ve had the chance to earn it, let alone accumulate any of it.” The first and foremost step towards being out of debt is to grasp what debt actually entails. The very basis of debt is to live in credit which comes in the form of credit cards and of course loans. The more you depend on credit at present, the deeper the grave you are digging for your future. To have a clear idea of your credit capability and how to be far from debt, you need to understand the functions of credit reports and credit scores and how they are contingent on your past financial payment record. It is all about how regular and punctual you have been in paying off your dues. As Manganiello says by a well-managed personal cash flow you can walk up the ladder leading to a Millionaire by being debt-free. But the question is – how to manage a good cash flow? Here’s how – by making you’re your earning increase consistently, paying your bills on time and using your credit cards wisely, minimally and only when you need them. Managing Your Cash Flow

Talking about credit reports and scores, this is what Manganiello refers to as Personal Cash Flow. And to understand this you have to undergo what he points to as Cash Flow Analysis. CFA is analysis of how much money you make per month and it is spent. This can be categorized under four heads, namely:

Secured debts

Unsecured debt expenditures

Net monthly income

Living expenditures per month

If you have a positive CFA, you can be ecstatic knowing you have cached in some amount that month. If the CFA is negative, well, it is time that you begin setting up a cash flow mechanism and adhering to it. Use Your Credit Card Wisely Derek Sivers, another self-made millionaire says he always hated being in debt even when he was a mere circus clown and musician by profession and always had to be worried about paying bills. As the millionaire remarks, “I’ve always been very debt-averse. I don’t like being in debt at all, even on the small level. I never bought anything with a credit card unless I had that much money in the bank. The credit card was just a convenience. I never went into negative debt on a credit card, even as a teenager because I just hated that feeling.” This indeed comes as a clarion call especially for today’s youth. They splurge on hot couture stuff, go vacationing and do much more than they can actually afford. The result – a long credit card bill at the end of the month. But looking closely into the life of the millionaire next door, you will find that they do not flaunt their money or ride expensive sedans or don designer clothes without any proper planning. This is because they have always believed in living below their means and definitely not on credit.

So the point remains – use your credit cards only when you feel the need of it and do not have sufficient funds in your bank account to go about it. It is quite natural to have bungles a few months a year and if you have accumulated a big credit card bill, try to pay it off the same month by working extra hours and making some additional shillings. Eliminate Debt The above suggestions the millionaires for a debt-free life are indeed enlightening and point to certain common elements in all these self-made personalities. For one, they know where to draw their line while spending, even if they have millions of dollars in their bank accounts. Few Common yet Proven Debt Elimination Tips Apart from the above suggestions and advice’s listed below are some common yet proven steps that you can take to lead a debt-free life: 1. Dedicate 10% or more, depending on your

income, to clear your debt on a monthly basis. 2. Always try and maintain records of everything that you earn, spend, save and invest. Only when you’re sure of your numbers, would you be able to remain debt

free for the rest of your life. 3. Human beings, these days, are dominated not by other human beings but by their wants. So, never give into your wants and purchase things that you don’t need. 4. Snowball the Debt – this is a principle where you start with clearing the smallest debt first and then moving onto the bigger debts. To conclude, all the expenditure these millionaires make turn it into an investment and bring them returns. They have inspired hundreds of men and women to remain debt-free and live a contented life at least, if not that of a millionaire. So, it is now up to you to follow their footsteps and attain a similar lifestyle.

The millionaire’s guide to being debt free  
The millionaire’s guide to being debt free  

A lot of people dream of being a millionaire, envisaging themselves coming out of grand limousines in stunning attires and ensembles just li...