Living your dream life debt free requires a simply task of going back to Grade 1 math lessons and applying the concepts. Recall how your teacher taught you how to add and subtract. Two very important points to remember are: 1+1 = 2 and 10 – 1.

You might be giggling at this in that it is so simple but keep reading. Interestingly, as simple as it is, not everyone applies this math in real life situations.

If you recall your Grade 1 days, you will remember that the teacher explained that zero is not enough so there is a need to borrow from the adjacent digit. Likewise, in your adult life, you can think of the first number representing the source of your monthly income and the second depicting debt or expenses – you need to borrow from another in order to complete the operation.

Now hold that thought and think about this: living your dream life debt free.

Most people may define it as enjoying a luxurious lifestyle while others may define it as living a less stress-stuffed life. If you wish to live your dream life debt free then equalize your definition of “dream life” with the basic concept of basic mathematical operations that you learned in Grade 1.

What is 1+1?

1+1 requires assessing your monthly income. This is easy if you are receiving a constant amount from a particular source or sources in a month. Simply add these sources. In case your monthly income is variable, then project an income considering the lowest amount that you realistically get in a month. Warning: Do not assume. If you assume, it’s like counting the chicks from the eggs of your hen before they hatch. Plan your expenses according to what you have and not what you can have. Remember that 1+1 equals 2 and it can never be 3. For example, if you are expecting your sales volume to escalate, even if it is really possible, exclude it in preparing your budget.

What is 10-1?

This reminds us that we should spend within the limits of our income, otherwise we will have to borrow. If you think that this is simple, then why are there people out there spending more than their monthly income?

Well it’s because they are lured by that vision of a ‘dream life’ into over using their credit limit and acquiring mortgages that they can’t afford. Basically they are spending money that they have not yet earned.

How do you avoid this?

Use your math skills to define your dream life. Redefine your dream life to match the sources of your income. If you can’t get your dream life on your current income, then find ways to increase your income sources. Here are a few options:

Turn some waste into money . Auction those items that you are not using anymore. Remember, attaching sentimental value on objects in your house won’t help your situation. It will just turn your home into a warehouse of unused things that in essence are costing you money.

. Auction those items that you are not using anymore. Remember, attaching sentimental value on objects in your house won’t help your situation. It will just turn your home into a warehouse of unused things that in essence are costing you money. Optimize online tools that generate income . It is much easier to endorse products now. Gone are the days that only celebrities can endorse products. If you find an item that is selling like hot cakes, identify the source and let your friends in your social network know that you are a distributor of this item.

. It is much easier to endorse products now. Gone are the days that only celebrities can endorse products. If you find an item that is selling like hot cakes, identify the source and let your friends in your social network know that you are a distributor of this item. Monetize your hobby . Turn your hobby into something that generates income. With this, you satisfy two needs – need for recreation or break and the need to augment your income.

. Turn your hobby into something that generates income. With this, you satisfy two needs – need for recreation or break and the need to augment your income. Minimize “1-0”. Realizing your dream life debt free is not only about earning more money. It is also important to minimize expenses. If you cannot control your spending, no matter how hard you work or how much you earn, you will be likened to a bottle with a broken base that no matter how much water you pour in, it will never get filled.

The key is keeping life simple and healthy. Itemize your expenditures. Is not the bulk reflective of your expenses used for unhealthy activities, hobbies, vices or food? For example, if you transform your diet to veggies and fruits, you will cut considerable costs in food expenses. If you exercise, you can cut medical expenses that may be equivalent to thousands of dollars down the road. If you stop smoking, you can use that money to fund your emergency fund. Do you see where I am going with this?!

Basically, living your dream life debt free is simple. It’s not difficult, not complicated, and not impossible. Just use the math you have known since you were little as a a basis for defining your budget. This simple step will be the key to living your dream life debt free.