It happens to the best of us – building up debt that it becomes too complicated to pay off. Whether it be from spending too much with credit cards or unexpected expenses occurred that put you over the edge, debt is quite common.
The first step is to acknowledge the amount of debt you owe and commit to paying it off. Once you are in that mindset, you can start to develop plans to pay everything off as efficiently as possible.
Here are a few ways to help you pay off your debt.
In This Post:
1. Create a Budget
The best way to hold yourself accountable is by developing a budget. Putting your finances to paper helps to give you a clear snapshot of what you owe, how much you spend and what you bring in. You can adjust your expenses accordingly so to allocate more money towards your debt payments. Once you see where all your money is going, you can use it to keep your finances in order and be more conscious with your money.
2. Look at Balance Transfer Cards
If you have a decent balance owing on your credit card, more than likely most of your monthly payments are going towards paying the interest. The interest on a credit card is what can catch people off guard and pull them into a never-ending cycle of debt.
But you can transfer the balancing on your existing credit card over to a balance transfer card. These cards have a low-interest rate for a period that would make it easier to pay down your debt. So by getting a new credit card, you can save money in interest payments.
3. Sell Anything Not Being Used
Take a thorough look throughout your home and see if there are items you haven’t touched in a long time. If there is an old gift sitting and collecting dust, it is time to sell it. Putting things you no longer use up for sale is a quick and easy way to make some quick cash. You can then use that money to put towards paying down your debt.
4. Bring in Additional Incomes
If you are drowning in debt, it may be time to bring in an additional income. Maybe it is a part-time job or a side gig once a week, any extra money you can bring in can go straight to your debt. If you have a skill that others need help with, be a tutor. If you are craft and handy, take a hobby and turn it into a small business.
5. Reward Yourself
Even though the point of all of this is to cut expenses and pay down debt, you need to keep yourself motivated. The best way is to set small, realistic goals and reward yourself when you achieve them. Just don’t go overboard and put yourself back to square one.
Set multiple goals, both short-term and long-term. Say in one month you want to pay down $1,000, and by the end of the year you want to cut your debt in half, you now have to goals to work towards. When you achieve your one-month goal, treat yourself to give you the boost to continue on your long-term goal.