If you are reading this, you must have a goal to get out of debt faster. Most likely, you have heard you should avoid paying only the minimum payments on credit cards and high-interest loans. This advice is absolutely true. The best way to get out of debt quickly is to pay at least a little more each month to bring down the interest charges and principal. You will save a great deal over the life of the loan or pay off your credit card debt faster. But there are tried and true methods of accomplishing this including getting low-interest rates on your cards and loans and increasing the available funds you have to use for payments.
–World Example: Take for instance you charge $1,000 for a new television on a credit card with an interest rate of 19%. Your monthly minimum payments are $25 per month. If you only pay the minimum it will take you over 5 years to pay off the total. Worse, you will have paid $596 in interest!
How Do I Get Out of Debt Faster?
Try some of these action items to be debt-free quicker and enjoy more financial freedom!
Open a 0% Interest Rate Balance Transfer Credit Card
If you have good credit, you may be eligible for interest free balance transfer credit card. You’ll get set up on a payment plan and will not have to pay the $596 interest. Just remember to pay off your balance before the end of the time frame.
Negotiate Lower Interest Rates on Credit Cards
High-interest rates on your credit cards will keep you in debt longer. Your cash won’t make a big dent with high-interest rates. Contact your credit card companies and negotiate your rate. If you have
Get a Side Gig
There are many part-time jobs or even quick one-off jobs you can do to earn extra cash. Babysitting, mowing loans, or even painting pay well and will be able to fit into almost any schedule. If you have creative skills like a graphic designer, voice over, or writer, there are many sites that connect freelancers and business. Check out Fiverr, Freelancer or Upwork.
Sell your stuff
You know the old adage, one person’s trash is another person’s treasure. Well, make some money with your unwanted and unused things. You’d be surprised how much money you can get for that old lawnmower or rug that you no longer use. Places like Facebook Marketplace and Poshmark are great places to start.
Use a B
Create a budget and stick to it. It will help you keep your spending in check. We’ve all done it before, overspending randomly throughout the month on impulse purchases or extra nights out at dinner. If you create a budget you will be more apt to not overspend. If you can cut out a few monthly extras per month, you can put that extra cash towards your debts– even an extra $10 helps!
Make a Grocery List
Grocery lists are great to keep your food spending in check. Not only will you stick to your budget but you probably will spend much less time wandering around the grocery store. Now that’s what I call a win-win!
Cancel That Membership
These days there are so many memberships to keep up with. Whether it’s Netflix, Amazon Prime, subscription boxes or the gym, you may not be using them enough to justify the expense. Take a look at the memberships and see where you can cut. If you can, you may be able to put hundreds of extra dollars at your debt.
Tip: If you have T-Mobile they now offer a free Netflix subscription with your T-Mobile plan!
Change Your Habits
Buying lunch every day in the office cafeteria or going out to lunch every day will quickly add up. Just think $10 a day for lunch each working day will cost you $200 or more per month. Try packing a lunch, like taking leftovers or a simple sandwich. It could save you $150 or more per month. Throw that at your debt and you’ll make a huge dent!
Not only will smoking kills but it costs an arm and leg or even lung every week. If you are a 1 pack a day smoker, it can cost over $70 per week. In a year that’s over $5,000 per year!! That’s a lot of dough! Not only will it save you money but it will save you money on your health care in the long run.
All these suggestions we have made will help you put more money in your account to help you pay off your debt faster. Some of them are simple and quick and others will require a little more effort. Your mind will be at ease and your bank account will thank you whether you start with implement one or more of these tips to get rid of your debt.