– Debt, it is like a
sword, it is a weapon. You can use it to, well, cut the enemies, protect your family, or you
can use it to cut yourself. So, what do you do with it? And there are two kinds of debt, there’s the good debt
and there’s bad debt. I want you to think about debt
as, instead of the word debt, I want to teach you a new vocabulary. I want you to think about debt
as leverage, it’s leverage. So debt is nothing more than
the money that you borrow from someone or an institution
to perform an activity. And that activity can
make you richer, right, you cut off your enemy, or make
you poor, it is that simple. So if you think about debt in that kind of setting, in that kind circumstances, good debt, what do I mean by that? Let’s say good debt is a business loan that you borrow from the
bank to expand your business, to buy that new piece of equipment. Maybe to hire more employees to grow your company, to grow your business. That’s good debt, that’s a business loan. Or it could be a mortgage
that you borrow from the bank to invest in investment
property, that’s good debt. Or it could even be student loan that you borrow from the government. Now you are improving your skillsets, so you can deliver more
value to the marketplace. That’s okay too, that’s a good debt. But you notice, it’s not
so much about the debt. It’s the person that’s
borrowing the money. So, let’s say the entrepreneur
borrowing money from a bank, if the entrepreneur is smart, and is wise, and he uses that money or
she uses that money to grow the company, and generates
more revenue, that’s good debt. On the other hand, different entrepreneur, same circumstances, borrow
money from the bank. Then makes a bad investment,
bought the wrong piece of equipment or expand too quickly. Now the business is losing money. Well, it went from good
debt to now bad debt. Does that make sense? Now, let’s talk about bad debt. The second kind of debt,
the worst kind of debt. What am I talking about, car
loans, payday loans, right? Credit card debt, personal
debt for personal consumptions. Or even other types of debt
that you are borrowing, but really is for your personal pleasure, right, it doesn’t really generate money. It doesn’t make you richer,
it makes you poorer. That’s what I call bad debt. So, you think about debt,
it’s not that it’s good, or it’s bad, or anything like that. It’s simply a form of leverage. How do you use this leverage
to make you richer or poorer? So I started off with because
I was a lousy businessman, I had a lot of bad debt, and
I started paying them off. And I started paying them
off, and I started paying them off, and now I use leverage for good. I want you to think about it. Almost every millionaire and billionaire in the world uses debt,
or leverage, in some form. Almost every single one of them. So today I have very,
very little bad debt. I have a lot of good debt, good debt that makes me richer, that makes me money. So, let me give you three steps that will help you get out of debt. Step number one, focus on increasing your income, not lowering your debt. I want you to ask yourself a question. Making the money that
you are making right now, how long would it take you
to pay off all your debt? Comment below, would it take
you three months, six months, one year, two years, five
years, 10 years, 20 years? When you think in those
terms it’s so overwhelming. How the hell am I gonna pay off all those money that you owe? So it’s unrealistic to
think you can be debt free or get out of debt with
your current income. At least for most people
it’s virtually impossible. So what you want to focus
on is increasing your income so you can pay off that debt faster. What you need is, it doesn’t
matter what it is that you do. You could have a job, a J-O-B. You could have a business,
it doesn’t matter. But what you need is what
I call a high-income skill. A side hustle that you could make money on the side in your spare time, when you’re not at work, when
you’re not in your business, to bring more money in so you
can pay off that debt faster. Let me give you an example, one of my best friends’ husbands,
he is a good employee. He makes about $100,000
a year with his job. Pretty good income, pretty good pay. But in his spare time, in summertime, he actually teaches golf. And in the wintertime in Vancouver he teaches people how to ski. So he’s a golf instructor in summertime, and then in the wintertime
he is a ski instructor. It’s something that he
loves, it’s his passion. But he also makes good money doing it. By having that high-income skill on the side on top of the
100K that he’s bringing in every year, he makes an
additional $30,000 a year as a golf instructor and a ski instructor. That’s a high-income skill. Now, I want you to imagine this. With whatever you’re making right now, if you could bring an
additional 3,000, 5,000, 10,000 a month without changing
what you’re doing, just adding an additional
stream of income, how much faster would
you pay off that debt? That’s exactly what I did. I worked in my early 20s. I told you, I was $150,000 in debt. I was making only a few
thousand dollars a month. But as I was working and developing my high-income skill I
was making more money. I was then making 5,000 a
month, 8,000 a month, 10,000 a month, 15,000 a month,
20,000 a month, 30,000 a month. You see, when if I just focus on the debt, if I was using the
$2,000 that I was making to pay off that 150,000 in debt I would wait till I’m like 65 years old. I will never pay that damn thing off. But I was making more money, and I kept my expenses very, very low. So I was able to pay that off 5,000 here, 3,000 there, 10,000 there, 15,000 there. And before you know it I was debt free. So, that’s step number one, focus on increasing your income,
not lowering your debt. Step number two, use good
debt to invest in yourself. Now, remember, debt is
nothing more than leverage. Even when I was $150,000 in debt I was continuously investing in myself. I was investing in course and
programs to upgrade my skills. You see, money earned is a
byproduct of value creation. If you want to make more money you need to deliver more value. In order to deliver more value to the marketplace, guess
what you have to do? You need to improve your skills. You see, most people,
they want more money. Dan, I want more money. But they don’t want to
work on their skills. You see, in life you don’t get what you want, you get what you deserve. So my friends were
telling me you are stupid. You’re already $150,000 in debt, why are you still
investing in these courses? Why are you buying all these programs? Are you crazy, you’re stupid,
you should save the money. I was telling them, you know
what, I’m already 150K in debt. That $500 course, that $1,000 seminar, that is not gonna affect
anything, I’m 150K in debt. But if I could get one golden
nugget I can get an idea, I could learn a new skillset
through those programs, there’s a chance that
my life could change. And that’s exactly what I did. You see, you don’t have a debt problem, you have a skill problem. You work on your skills so
you can make more money, then your debt problem is gone. And step three, I want you to list every single debt that you have. And you may be thinking, no, I
don’t want to think about it. No, I want you to list every
single debt that you have. Maybe you have a credit
card debt of $5,000. Or maybe you have a
student loan of $10,000. Or you have another car payment, you know, car loan that is $8,000. And then you have another small little credit card here
and there, that’s $1,000. Okay, I want you to be very specific. I don’t even want you
to use round numbers. I want you to get absolutely
clear, crystal clear. It’s $5,236.52. It is $10,826. I want you to be very, very clear because when it’s a round number in your head what happens
is it always feels bigger and more overwhelming, all right? And clarity is power,
vagueness is weakness. You don’t want to have a vague answer. You don’t want to have a vague problem. You want to be very
clear, exactly how much you owe, and you list all of them. And I bet you, you can comment
below, once you do this it might actually not
be as bad as you think. Now you can see, okay, this
is what I have to deal with. This is what I have to tackle,
let’s do it one at a time. Now, what I’m gonna teach
you, step number three, it goes against every single
damn financial expert. What they’re out there,
what they’re telling you. Well, because most of them
are broke, let’s face it. They don’t have money, they
have a lot of debt themselves. What I’m gonna teach you works. Here’s what I want you to do. I want you to think about all the debt that you have right now. Let’s say this particular one, it has an interest rate of 20%. And this small credit card, whatever, it has a 12% interest rate. Every single damn expert, they will tell you here’s what you want to do. You want to pay off the debt that has the highest interest rate, right, that is costing you the
most amount of money. Oh, let’s do that, it
might sound logical, right? It sounds, yeah, that’s a logical answer. Here’s the problem, human beings we are not logical, we’re emotional beings. So instead of paying off the one that has the highest interest rate,
here’s what I recommend. What I would do is I would pay off this one first, here’s why? I want you to pay off the
debt, pick one that has the highest, the biggest
psychological payoff for you. You know the one I’m talking about. The one that’s been lingering,
maybe it’s money you owe to your family and friends
that they have been keep bugging you again,
and again, and again. And you felt so guilty and so bad. That if you pay that one debt off you will feel so good,
you will feel so alive. Pay off that first, even though the interest rate may be lower. It doesn’t make logical
sense, forget logic. That’s what I did, when I paid off that first little bit of debt, suddenly what happens is, oh, I
felt I could do this. I could actually start crossing
these off one at a time. And small success leads to bigger success. And then I pay off this one, and then you can pay off this one. And then you pay off this one. But until you pay one off
this feels so overwhelming. And guess what, then you’re paralyzed, and you never take any action. I don’t want that to happen to you. So, step number three, pay off the debt that has the biggest psychological payoff for you personally, do that first. If you want to get out
of your debt even faster, and you want to develop
that high-income skill that I was talking about,
and if you’re serious, I want you to click on the link somewhere on this page it could be below,
it could be somewhere here. And join me for a
special two hour training where I’m gonna teach you
how to make $5,000 a month, $10,000 a month, or even $15,000 a month without prospecting, without cold calling, and without doing anything online. So go ahead and click the link there, and I’ll see you in class.