Five Tips To Get Out Of Debt Quickly
5 Tips For Getting Out Of Debt Quickly – Debt is a massive problem for many people. The issue is that it’s not really the debt which is the problem. It’s the interest you pay. This means you could end up paying many multiples of what you originally spent. It also means you could end up spending years or even decades getting out of debt. This is why it’s critical that you pay of your debt as quickly as possible. Here are a few tips for doing this.
Sell What You Don’t Need
Everyone has unwanted and unused items around their house. These items sit there accumulating dust for years. Go through your home and make a list of anything you’re not using. The rule of thumb is that if you haven’t used something for 6-12 months, then you’re probably not going to use it. Gather up these items and sell them on the internet. Also, avoid the temptation to spend any money that you make. Use the money to pay off your debts immediately.
Get A Second Job
It’s a bitter pill to swallow, but you may have to get a second job. This could include an evening, weekend, or part time job. No one wants to do this, but here’s what you need to remember. The longer you take to pay off the debt, the more you’ll have to pay. What you should also remember is that you won’t be working a second job forever. Once the debt is paid off you can quit. You can also make more money by getting a promotion, or switching to a job which pays better.
Change Your Lifestyle
At some point you may have to accept a drastic lifestyle change. Depending on how much you owe, this might be something you want to consider. Cut back on everything which isn’t an absolute necessity. This might include clothing, nights out, alcohol, food, subscriptions etc. Use this money to pay off your debt. Remember, like the above tip, this is only temporary, so hold your nose and get it over and done with. Something else to remember is that, if your lifestyle puts you in debt, then you’ll definitely have to change it.
Pay More Than The Minimum
With most debts, there is usually a minimum payment. This is amount represents the interest and is the lowest amount you’ll have to pay back. The issue is that, in most cases, paying this interest does nothing to lower the principal. To truly get out of debt, you’ll have to pay back more than the minimum. This is the only way that you can lower the principal, and the more you pay, the faster you’ll do this.
Pay Off Smaller Debts First
This is a simple debt reduction strategy and tips. Basically, make it your goal to pay off smaller debts first. Once you’ve done this, you’ll have less to pay overall, and this will ease your debt burden. There’s also a psychological component to this. By clearing debts you’ll reduce stress and motivate yourself to continue the process.
Also see: How To Save Money on a Tight Income?