applying the debt payment strategy to investments

[KTP]

Hey, so I am curious if any of you have tried to apply the different debt payment stragegies to investments, and if so, what has worked for you.

I have read quite a few stories about someone who had $40,000 in credit card debt that through diligent work they manage to pay off in 1 to 3 years. I don't read very many stories about people setting up the same goal to invest $40,000 in 1 to 3 years. Perhaps the motivation is not there for investment vs debt payoff?

What are the things people do when trying to snowball credit card debt payoffs? They cancel extras like cell phones, sell cars they don't use, clip coupons, eat at home. If only there was a way to get into the same mindset for investment. I haven't gotten there yet, that is for sure.

[disneysteve]

What we've done over the years is that every time we got an increase in income, we increased the amount going to savings. Any time we paid off a debt, we increased the amount going to savings. We didn't send the full amount to savings but did send a substantial portion of it. For example, when we paid off DD's braces ($150/month), we increased our monthly savings by $100 and left $50 for general spending. When we paid off our home equity loan ($218/month) we increased our monthly savings by $175 and left $43 for general spending.

By doing that, we've been able to gradually increase our spending while simultaneously greatly increasing our saving.

[tulog]

For some people who are in debt, with their back against the wall so to speak, the pressure they must feel can push them to be extremely efficient and resourceful. Like a rat with a small bit of cheese. It is almost a matter of survival, which is a strong motivator.

How motivated can you make yourself to save monies for your various investments? When your balance sheet is already strong, you might have to play psychological tricks on yourself to convince yourself that you must still buckle down and be efficient in your savings and investment efforts.

[KTP]

For some people who are in debt, with their back against the wall so to speak, the pressure they must feel can push them to be extremely efficient and resourceful. Like a rat with a small bit of cheese. It is almost a matter of survival, which is a strong motivator.

How motivated can you make yourself to save monies for your various investments? When your balance sheet is already strong, you might have to play psychological tricks on yourself to convince yourself that you must still buckle down and be efficient in your savings and investment efforts.

YES! this is it exactly. (I love the mental image of the rat with the bit of cheese btw).

It is so very hard to stay motivated on saving when you pass a certain point. Little comforts that are not really comforting (like paying $30 for a night out at the movies just to see some hollywood remake) or guilting yourself into doing things (like paying for a vacation for your parents). Stuff like this you wouldn't do if you were up against a wall of debt, but the same "rat with cheese" mentality could enable you to amass a great investment portfolio in a very short timeframe if you could figure out the motivation.