How To Get Out Of Debt, Stay Out Of Debt And Save For Your Future


If we are stressed about money while we are healthy and able to work, think what it will be like to try to support ourselves when we are older, not so healthy and not able to work as much as we have in the past. Who will support us then?

People are working two or three jobs, and bankruptcies and foreclosures are at an all-time high with little hope in sight. We need to change our financial habits and get a handle on our debts. If we understand the value of money and its power, we can use it to our advantage to make our lives more productive.

Can you imagine how much money you could have at retirement if you saved up the money for all your purchases (including a modest car and home) before you bought them, then saved the rest of the money that you would have paid in interest to the bank? You could be your own bank, and you could collect all the interest. Wouldn’t it be nice if we could teach this concept to our children?

A Modern-Day Plague
We live in a throwaway society. We purchase anything and everything our hearts desire. To do so, we use credit cards, finance through banks or use other means. Then, when an item breaks, it goes in the garbage and off to the landfill. We don’t bother to fix it.

I read an interesting book called Affluenza, by John De Graaf, David Wann and Thomas H. Naylor. It is about the disease that is consuming our nation right now. We want to live like the affluent, so we do whatever it takes, which includes using credit cards and going into debt for things that make us feel good for the moment. Our children grow up with shopping mall fever. They must have the latest, greatest electronic devices, computers and cell phones (much better than their parents).

As a result of going into so much consumer debt, we now have a rash of bankruptcies, the stress of excess and the addictive virus, hoarding fever. We actually buy things to make ourselves feel better. When it all piles up around us, we build garages or rent storage units to hold and organize our stuff. All of this causes side effects like working too hard, lacking meaning in our lives, losing emotional connections with loved ones, having unrealistic expectations and experiencing dissatisfaction.

Affluenza could very well be a modern-day plague sweeping across our nation. An epidemic of great proportions has hit all our families. We are getting deeper and deeper into debt. We are in the rat race. We must ask ourselves: Why are we working so hard and not getting ahead? What are we doing it for?  Are we teaching these bad habits to our children?

Calculate Your Living expenses
Create a chart to determine exactly what amount of money you need to sustain your lifestyle. Evaluate this chart to see how you spend on interest-bearing payments. Develop a plan to cut the spending. Every dollar you cut back is a dollar in your savings account.

Think about the possibility of scaling down and not needing so much to sustain life. Evaluate entertainment, vacations, impulse purchases and other wasteful spending habits. Make a commitment to cut up the credit cards and pay cash for everything. If you need a card to make purchases, use a debit card. If you don’t have the money in the bank to purchase what you want, don’t buy it.

Getting out of debt takes a firm commitment and discipline from everyone in the family. This chart will help you evaluate exactly what is needed and what can be cut out of your life to simplify living and stop the accumulation of debt. It doesn’t matter how much money you make, it is how much you save that counts.

Your chart should contain the following categories:

  • House Payment
  • All Utilities
  • Telephone
  • Food
  • Clothing
  • Auto Payments
  • Gasoline
  • Insurance on Autos
  • Health Insurance
  • Medical and Dental
  • Education
  • Fixed Debts
  • Credit Cards
  • Entertainment
  • Other
  • Other
  • Other
  • Total Per Month
  • Total for Three Months
  • Total for Six Months

It is a good idea to have a three-to-six month supply of cash on hand (not in the bank) to pay bills just in case the banks have problems and you cannot get your money out. It is good to have small bills and coins for smaller purchases. The stores might not be able to make change for a $100 bill. It takes time to save enough money for emergency bill-paying.

If you are already in debt or must have some debt, the following chart is the recommended amount. Do not exceed more than 36 percent of your monthly income for debt expenses or you will be in financial trouble.

  • Car Payments: 6 percent of monthly income
  • Housing: 25 percent of monthly income
  • Credit Cards of any kind: 5 percent of monthly income

If you can get out from under the pressure of debt, you will give yourself a 36 percent raise and have that extra money to put into saving for your future.

Debt Elimination Program
I have been researching a program to get out of debt in about one-fourth the amount of time it would traditionally take. This includes the home mortgage and all other debts. It takes discipline and focus. This can also be called behavior modification. A person must be willing to take a certain amount of money each month and apply it to debt and keep applying that exact amount each month until all the debt is eliminated, even if it takes seven to 10 years. You can purchase the software on my website.

The software has you list all your monthly living expenses and every debt that you must pay every month to meet your monthly bills. It will calculate the amounts of the debts and the interest rates. It recommends that you pay off the smallest and highest-interest debt first, then the next smallest up to the largest. Any extra income such as tax returns, bonuses, inheritances, sale of properties, etc., will be applied to the debt as well. This is called the snowball effect. The software has a rapid payoff calculator and spreadsheet.

Here is an example of the snowball effect on a person’s debt:

DebtAmt. OwedInterest Rate MonthlyPayment
Dental Bill$5008.5 percent interest$100 per month
Credit card No. 1$2,50018.5 percent interest$500 per month
Credit card No. 2$5,00021 percent interest$100 per month
Car$15,0006.8 percent interest$595 per month
Home Mortgage$75,0005.8 percent interest$850 per month


Say the smallest debt is a dental bill of $500, with a monthly payment of $100. The next lowest is a credit card with $2,500 at $18.5 percent interest. The next is another credit card with a $5,000 balance at 21 percent interest. The minimum payment on the second credit card is $100 per month. This will get you every time if you make only minimum payments. If you paid the $100 per month with accruing interest, it would take more than 20 years to pay it off. Ouch! So it must be accelerated.

When the dental bill is paid off, add the $100 you were paying for that bill to the amount you pay monthly for the first credit card. After the first credit card is paid off, add amount you were paying on the first credit card to the amount you are paying on the second credit card until it is paid off. When second credit card is paid off, add the amount you were paying on the second credit card to the car payment until the car is paid off. Then, take the amount you were paying on the car payment and apply it to principle on the mortgage payment. You will accelerate your mortgage payments by paying large principle payments. That reduces the payments again by about a fourth of the time it would have taken if minimum payments were made.

The software calculates the amounts owed, the interest rates, the amounts paid, the reduction in debt and the amount you will save on interest by using the rapid payoff calculator and spreadsheet. The calculations can be adjusted if something unforeseen happens and you incur extra debt. It keeps you disciplined and focused on debt elimination. Ultimately, when all your debt is paid off, it helps you save for your future by paying yourself the interest and principle you would have paid to the bank. It is amazing how things happen to help with the goal of debt elimination and saving for the future.

I believe there is a universal force from God that helps us accomplish our goals. It is like the law of attraction that is talked about in the movie “The Secret.” Amazing things start to happen when we are clear about what we want. “Ask, and ye shall receive,” (John 16:24).

About 10 years ago, my husband and I were trying to get out of debt, and I prayed seriously about it. We were flying home from a trip and I was pondering about what to do, when it came to me very clearly. I believe I was shown a vision of how to get $70,000 dollars to pay off the balance owed on our home. I wrote it down in a notebook step by step as I was shown. I went to work doing the things I was shown. It took about six months to accomplish, and I had our home paid off.

Our home is paid for and we are no longer slaves to our mortgage company. It feels so good to be debt-free on our home and know that we won’t be kicked out if times get tough and we get into financial trouble. We now take our mortgage payment and save it. I was so amazed at how it worked and how everything fell into place for me.

I still use the following process:

  • I state my goal of what it is I want to accomplish.
  • I visualize that I already have it.
  • I thank God every day that I already have it.
  • I act as if it has already happened.
  • I do not try to figure out how it will happen.
  • I do not doubt that it will happen.
  • I just know that it will, and it does.

Emergency Food Storage and Survival HandbookPeggy Layton is the author of seven books on the subject of Emergency Food Storage and Survival.

Debt Elimination Software, Books And Emergency Supplies
If you are interested in the Debt Elimination Software talked about in this article, any of the books, emergency supplies, wheat grinders, ION water purification drops or emergency food storage, click here.

Food-Storage Meals
Are you interested in a great source for pre-made meals that can be stored for 15 years and taste great? I have been testing out emergency Food Storage Meals, packaged in Mylar™ pouches. These meals serve four people and are ready to just add water and cook. I find them delicious, convenient and easy. Click here.

Personal Liberty

Peggy Layton

a home economist and licensed nutritionist, holds a B.S. in Home Economics Education with a minor in Food Science and Nutrition from Brigham Young University. Peggy lives in Manti, Utah with her husband Scott. Together they have raised seven children. Peggy owns and operates two businesses: One called "The Therapy Center", where she is a licensed massage therapist and hypnotherapist, and the other an online cookbook and preparedness products business. She is nationally known for publishing a series of seven books on the subject of food storage and also lectures and teaches seminars about preparedness and using food storage products. Peggy practices what she preaches, has no debt, grows a huge garden, lives off the land, raises chickens, bottles and dehydrates food and has time left over to operate her businesses. To check out Peggy's cookbooks and self sufficiency products go to her website To get a free sample of three different storable meals that have a 15-year shelf life go here.

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