Are you dealing with the dreaded d-word — debt? Use these tips to pay off your debt quickly.
You are not alone. So many people are carrying debt. From student loans and mortgages to credit cards and medical debt, debt is practically the norm. But what if you’re sick and tired of constantly owing someone money? What if you’re done with paying high balances and even higher interest rates?
Now if you’re ready to be done with debt, here are some ways to get yourself out fast.
Step one should be pretty obvious: stop borrowing. To successfully pay off debt quickly you need to stop taking on more debt. If you’re deep in credit card debt, this means you need to let go of the cards for a while and re-acclimate to cash and debit. While you’re trying to conquer the burden of debt, don’t take on more or put yourself in a situation where you might slip.
Pay Off High-Interest Debt First
If you really want to pay off your debt quickly, pay off your highest-interest debt first. High interest can be a huge barrier to getting ahead, so by slashing your high-interest debt first, you’ll make a bigger impact in your debt repayment and pay less money on the life of your loan.
In order to stay motivated, calculate how much money you are putting toward interest each month. Then go a step further and calculate how much interest you are putting to debt each day. Now imagine what you will do with that money once it’s freed up. Start thinking about your dreams and imagine what your life after debt looks like.
Set Up an Emergency Fund
Ever had your car break down at the most inconvenient moment? Or suddenly get ill and need to take some time off? Unexpected situations happen all the time, which is why it’s imperative you set up an emergency fund. Emergencies are not a matter of if, but when – think of your emergency fund as the when-everything-goes-wrong fund. Why is this so vitally important to paying off debt? Because you’re likely to get into more debt without it. Even a small emergency fund of one to two thousand dollars can help protect your finances when things go awry.
Live on a Bare Bones Budget
To really pay off debt quickly, try living on a bare bones budget. A bare bones budget is one that focuses on essentials — i.e. everything you need to live. Of course, you need housing, food and transportation. But do you really need expensive cable or dinners out three times a week? If you want to get really serious about paying off debt quickly, cut back on unnecessary expenses. It can be tough to cut back, but it’s only temporary. Debt doesn’t have to be forever and a little sacrifice now can make a big payoff later.
Get a Side Hustle
Aside from cutting back and spending less, you should also focus on the other side of the coin: earning more. Earning more can be a rewarding experience and catapult your debt pay off forward. Start by hustling outside of your main job to make extra cash and boost your yearly earnings.
What Can You Do Today?
Let your dreams inspire you to pay off your debt! Dreams are powerful and can help combat the negativity surrounding debt. It’s easy to become overwhelmed or feel totally apathetic. But, it is possible to become debt free – it simply requires action, creativity, patience, and persistence. If you’re looking to pay off debt quickly, use these tips to get started and say sayonara to debt.