Would you like to know how to become debt free? Our culture has become increasingly unfriendly to living a debt free lifestyle over the years. I think we need to find our way back to the way my grandparents lived.

They built their house with cash. It took them a few years, but they did it. And when it was done, it was like the land it was on; free and clear of any debt. They didn’t have credit cards and car payments. Can you imagine what that would be like?

If you are ready to live a more balanced life, one that has you living within your means, I will give you a few tips for how to get out of debt. You may not like it at first, but it can be done.

The first thing you have to do to get free of the crushing debt is to take stock of your assets and liabilities. Be prepared, you might be shocked at what you actually owe and how little what you do own is actually worth.

With the economy the way it is, the housing market is way down and so is the stock market. So for many Americans they now have more debt than asset.

There are some debts that are a given. Unless you want to give up your home, you have to make the payment on it. You are going to have to pay for a place to live one way or another, whether it’s rent or a house payment, right?

If you are trying to get out of debt, the credit card bills, the doctor bills, and other payments of that type must be made.

After you have taken into account what you owe each month, you must have a budget. And you need to resolve to stick to it. This is going to be hard at first, but you will get used to it. When you see the amounts owed on bills going down every month it’s going to be worth it.

You are going to have to make some choices about certain things in your life. These choices might seem painful, but they are necessary if you are going to have a debt free life.

An example of this is the category of food. We all need to eat. We don’t need to go out to eat. It is possible to make healthy, well-balanced meals at home for much less than it costs to eat out all the time.

Buying packaged foods frome the grocery store is also more expensive than buying the ingredients and making things ‘from scratch’. Cutting down on unnecessary expense at the grocery store is a good step towards getting debt free.

Utility bills is another place you can start saving money right away. We all want to be cool in the summer, but the house doesn’t need to feel like a walk-in refrigerator, does it? Adjust the thermostat, use the attic fan or free standing fans and leave the a/c off during the cooler parts of the day.

The same advice goes for heating in the winter. Keep the thermostat set lower and use space heaters where needed. Wood stoves are great, especially if you have access to cheap or free firewood.

Cell phones are another place many people can cut back costs. Every family member probably doesn’t need their own cell phone. Look at your plan to see where you can cut things back. Many people have a plan that is really not right for how they actually use the phone. If you never send a text message, then you probably don’t need that unlimited plan, right?

People lived for years with no television at all, so that ultra premium cable package probably isn’t a necessity either. Go back to basic, or cut it out entirely. Reading books or playing board games can be great family entertainment.

There are things that make life nice, but aren’t really necessary to live. You need to take a hard look at the choices you make for your lifestyle and decide what you can do without for a time so that you can get your finances in order. This is your first step in learning how to become debt free.

Here is a simple three step formula to help you be debt free:

First you must pay for all the things that are absolutely necessary. Food, shelter, clothing, and transportation to work,etc.

Secondly, start paying your debts off. Smallest debts first, moving up to the larger ones.

The third step is to put some money in savings for those unexpected emergencies. If you don’t, you will have something come up that will push you back into debt.

Learning how to become debt free may not be the most fun you’ve ever had, but I’m willing to bet you will enjoy being out from under the constant money worries.