Recipe For Financial Freedom

After reading this comment from Ryan posted at Blogging away debt I started thinking upon the general conditions which are responsible for getting us into debt. I started comparing the comment by the term Overclocking used in electronics.

“Overclocking is defined as making a particular component (of your computer hardware) run at speed higher than its rated speed. When you make the component run faster, you obviously derive better performance from it without spending extra on faster hardware. This is done by altering the default settings, providing extra power to the component and making sure that there is a proper cooling in place as components tend to heat up when they are clocked.”

Premature consumption, I would agree as my reason for getting into a debt trap. Getting a credit card in hand and the ability to pay in the next billing cycle made me to purchase things which I couldn’t afford and ended up buying many things. Finally I had to convert my purchases into installments. Now I am paying off those installments for the past nine months. Initially I took measures for reducing the debt but after nine months I still found myself into the same mess primarily because of loss of focus.

Now again back on track (focused for debt reduction) I want to speed up the process of debt reduction much similar to Overclocking but I realized that this is not easy, I have a single constant source of income (my salary). I have given a thought on the idea to take more debt at a lower interest rate invest it in the booming Indian market and after 3 months pay off my CC debt. Borrowing money from my parents and pay off the debt and then later on pay back in installments without interest. But again all these solutions would “over heat” me in the sense that I would still be in debt (some other kind of debt instead of credit card debt).

So finally I decided to wait, control my spending, (have not given a thought to alternative source of income), have a disciplined approach for debt reduction and get out of debt.