19. My Road To No Debt

Burhaan Pattel (00:00):

Hey, welcome to the marketing stack. I want to tell you a little bit of a story about my debt from a few years ago. I had borrowed some money, to invest in a business, which actually didn't quite work out. The person that we invested the money with, actually didn't fulfill on her promises. And so what happened was, I took a bunch of money, took a few loans and, gave the money over to the person who was supposed to fulfill and well, she didn't quite fulfill. And so that was one loan or actually two or three loans that I'd taken, which was quite a bit of money. And obviously those loans were personal loans from the bank. They were credit cards, they were, other sorts of loans. And, at the end of the day, I just had to sort of pay those debts every single month.

Burhaan Pattel (00:56):

And on top of that, you know, they were normal credit card bills, normal sort of debts that we get into. And in your, your situation, you might be in student loans, you might have certain debts that you have in your business, or maybe certain debts that you have just in terms of setting up your lifestyle. And so we all have debt at some point or the other. We all have these situations that come up where sometimes we get into a bit of a rut or we try to go for quick success. And, and we forget that, you know, sometimes the promises that people give us are not quite true. And so in my situation, what ended up happening was I, I realized that this person wasn't going to fulfill on this. I realized that my job wasn't quite fulfilling that the debt, I was basically playing with paying debt off every month, just the minimum amounts that credit cards and the loans needed.

Burhaan Pattel (01:55):

But, but you know, I wasn't making any headway and I knew that the loans were bad, you know, at that time in South Africa, the, credit card, credit, credit card companies were asking for something like 22% in interest per annum. And so I realized that no matter how long I was going to pay for this debt, the balance wasn't actually going to reduce because the interest was just so high. So before I left South Africa, when I made the decision to come to Thailand, to move to Thailand, I contacted a debt management company, debt consolidation company. And I, gave them all my accounts, and I said that I'm willing to go into sort of, I was willing to basically handle all the debt, not be allowed to take any more debt, basically declare not necessarily bankruptcy, but declare myself, almost insolvent.

Burhaan Pattel (02:55):

I can't remember what the word is right now, but I basically was not able to take on any more debt. Obviously I had maxed out everything that I had. So either way the banks were not willing to extend more, more loans to me, but I took all the debt over to this company. And they, they said to me that they would negotiate with the banks to, and the loan companies, to reduce the interest rate and give me a period of five years to pay the loan loans off. All I needed to do was sign the contract, pay a monthly fee to this company for the management of the accounts and make the payments, make the minimum payments that I needed to on the schedule. And I think one of the most important things that they gave me was a spreadsheet of all the accounts and all the expected amounts, that needed to be paid for the entire duration for the five years.

Burhaan Pattel (03:47):

So I had sort of 60 rows of payments that needed to be made in the spreadsheet. And on the top column, if you can imagine it along the top columns with all the accounts that I needed to pay it. I think at that point they were like six or seven accounts. Some of the accounts were small balances because the credit cards were really small. Others were larger. And I think in total, if I can, put a dollar value to all of it, it was somewhere around 30 or $40,000. And while you may listening, be listening to this and think for yourself, well, 30 or the $40,000 is not a lot of money. But for a South African kid who was just, you know, coming out of a divorce and, just started to work online, just started to make headway in this sort of space in this digital economy.

Burhaan Pattel (04:40):

You know, making something like a thousand dollars a month, every penny counted. But I set myself a goal and I said to myself, well, I'm going to make sure that every single month these amounts were paid. And they were actually quite easy to pay purely because, the amounts were a lot less than what the original sort of loans, minimum loan requirements were or payment requirements were. And so that was, I would say my, you know, one of my, one of my, one of the challenges that I may have managed to overcome, and it was, you know, I had this plan to work, every single month to make sure that I had some money coming in, or at least the minimum that I needed all the while, you know, taking care of my children, still traveling a little bit, you know, paying my card off to come to Thailand, you know, paying off these loans now that were reduced or, at a reduced interest rate and, and finding my way and really just working every single day to try to earn a living and to make these payments.

Burhaan Pattel (05:52):

And so, you know, I, I wasn't conflicted at all. When it came to, this situation, I was sort of upset that I had, I had to go into this, debt company to help me out. But, five years later, I can now say that I am absolutely debt free. I've paid every person, every company, every, even, even the company that I needed to pay for the loans. They had a final fee at the end of the, at the end of the period at the end of the five years to settle the final amount. And I was able to pay that, without much hesitation, of course, in my business, I've done really well over the last couple of years, it's been a good run for the last five years, work hard, 80, 80, 90, 100 hours a week, sometimes, sometimes seven days a week.

Burhaan Pattel (06:46):

Sometimes it felt like nine days a week, but, the fact of the matter is I think one of the main, one of the biggest successes, one of the biggest things that I had by way of achievement was the fact that I was enjoying my work. And, you know, working those hours didn't feel like a job. It didn't feel like a chore. And so earning the money and, you know, I had strategies to increase my fees every single month or every single client I had, you know, systems in place to acquire new clients. I had processes in place to get myself off of an hourly rate and to register a company and, you know, work and, and scale myself up in digital marketing and have successes with my clients, which all contributed to me being able to pay the debt off. And, you know, that's, that's what I would say is when you're trying to go towards a goal, when you're trying to settle a piece of debt, for example, you know, use the counter of like, how are you going to generate income?

Burhaan Pattel (07:52):

Cause there's two, two ways to, to, to eliminate it, right. Actually there's only one way to eliminate it, is you need cash to be able to settle that debt. And the only way to get cash is to get clients or to get customers or to earn more money. And so if you're in a job and maybe your money is fixed and you know, your boss can't give you an increase every month or every three months or whatever, trying to find a way to increase your productivity, find a way to, you know, increase your, efficiency at work. You know, there are ways that you can rise in a company without, sucking up to the boss or, you know, doing, doing anything out of the ordinary. You want to do things out of the ordinary, but to impress people. But at the same time, you know, if you're stuck at a job and you can't really progress, or you you're doing your best to progress during those eight hours or nine hours that you work, you can open a side business, you could do something in the evenings, you could do something on the weekends, you know, that can generate a little bit of cash, whether it's buying and selling stuff, you know, flipping things, you don't have to have a lot of money to start these things.

Burhaan Pattel (09:04):

Or you could even just start saving a little bit of cash, every single month, whether it be a dollar, $2 or $5, whatever you can afford, even if it's just 5% of what you earn or 10% of what you earn, whatever it is that you can save or, and save to, you know, have in as, as a, not, not necessarily as a nest egg or not necessarily as a spending so that you have money for Christmas, use that money to invest in, or use it to pay down on, on your debt. And, you know, those strategies of actually trying to find a way to settle your debt and to get the debt out of the way, is a way to, to leverage it up. Now there's a lot of people and that will say, you know, there's, you know, go into debt because you need to finance things, you know, a home, a house, maybe an investment portfolio.

Burhaan Pattel (10:01):

Yes, there's good debt and this bad debt, right? When you've got expenses, like a credit card or, you know, student loans that you're trying to pay off, those things are, are not contributing to your life. They're just expenses that you need to get rid of. And obviously if you've gone to school and you've benefit, benefit from that education, then that's fine. You know, that's going to pay off over time. However, you need to be efficient at your work. And you need to find maybe a second or third thing, that's going to generate a little bit of activity, but a little bit of work, a little bit more income for yourself. If, if it's something that you can't necessarily, you know, if you're not getting much from your job itself. So I'm using myself as an example because, you know, I was at a point five, six years ago where I never thought that I would be able to settle all these debts.

Burhaan Pattel (10:55):

But one of the greatest things that happened was that I wasn't able to pay any more, get any more loans. And so I decided then that, well, if I needed to live cash only without any credit cards, then I wouldn't be able to extend myself. And so I set myself a rule that if I didn't have money in my wallet, I didn't have money in my account. Then I wouldn't be able to buy the things that I wanted to buy. Right. You may need a new laptop. So, all right, maybe borrow one from a print or buy a cheaper laptop, you know, buy something a little bit more affordable instead of, splurging out on something brand new. Buy a second hand something, you know, if you need a new phone to work on Instagram or to start something, you know, start a little business using your phone, or you're using a laptop like you don't have to buy the latest and greatest thing, buy the thing that you can afford.

Burhaan Pattel (11:49):

And as you generate some income and you start paying off your debt and you start, you know, having a little bit of extra cash, then you can invest in, in better equipment, to support your business. And you don't have to like rush into these things. You can take your time and focus on, on getting the debt-free, focus on increasing your income, focusing on being more productive. And in that way, you'll find that those, that strategy, and actually recording, I would say, record your debts, you know, have a running total every single month of what you owe, what your balances are, how much you can afford to pay, what your income was, how much you've generated like these things to measure. You know, Peter Drucker says what gets measured gets managed. So the only way to manage your debt is to actually keep a running total.

Burhaan Pattel (12:41):

Like sure you, maybe you get a statement from your bank every month, but at least have a spreadsheet of sort of the running totals and how much you plan to spend, how much you plan to pay off, how much you plan to, save, like, have that plan and try to follow it as strict as possible. So bad, in the long run, even if it takes you five years, even if it takes you 10 years, like, you know that you get yourself, off of that hamster wheel. So with that being said, you know, you're listening to the podcast. Thank you so much for listening, subscribe, to, to the podcast, wherever you're listening. And, yeah, come say hello to me on, on YouTube. Come say hello to me on Facebook, wherever you, you are. And, yeah, I look forward to checking you out in the future. Hope you find a way to get debt free and, live your life on your terms. Thank you so much for listening. Take care.