Getting into debt is one of the easiest things in the world. Getting out of debt, on the other hand, is so difficult. You can spend a couple of months getting into debt and then decades trying to get yourself out of it again. Those interest payments will eat into your monthly budget every month and you’ll struggle to clear that debt.
If you find yourself in that situation it’s incredibly stressful and it can have a big impact on your mental and physical health. But it’s not a lost cause and there is a way out. Don’t give up on your dreams of financial freedom just yet, make these simple changes and you can get out of debt quickly.
Make A New Budget And Stick To It
It’s fine to include luxury items in your budget when you’re doing well, but if you’re in debt, you need to rethink those things. That doesn’t mean you can never do anything fun, but maybe you only eat out once a month rather than once a week.
Have another look at your budget item by item and think about which things are absolutely necessary and which things you could cut. It might seem harsh right now but if you manage your budget properly, you won’t have to do it for long. You can free up a lot of extra cash to put toward your debt repayments and clear them as quickly as possible. Then you can rethink your budget and start spending the money you were putting into debt repayments on fun things for yourself.
Earn Some Extra Cash
If you strip your budget to the bare bones and you still can’t afford to pay that much off your debts, you need to find some extra cash from somewhere. Asking your boss for a raise or looking for a new job that pays more are the most obvious ways to do that but that’s not always an option. If you can’t get more money from working, you might be wondering how to make quick money.
The good news is, that there are plenty of ways to make money. You could rent your spare room out or do a bit of delivery driving in the evenings. If you look around a bit, you’ll be able to find plenty of ways to make a bit of cash on the side.
Getting Out Of Debt: Money Management: You Cannot Afford to Wait Any Longer: Rich or Poor, 9 Simple Rules to Clear Your Debts Faster, Rebuild Your Credit.
Maximize Your Payments
The minimum payments on your debts usually just cover the interest and you’re only actually clearing a small amount of the debt.
Credit card companies love people who pay the minimum payments because they’re making a lot of money from them. Don’t be that person, maximize your monthly payments and clear the debt as fast as possible.
If you cut your budget right back and earn a bit of extra money on the side, you should put all of that money back into paying down your debts. It’ll be a tough period but once you’re debt-free, you’ll have so much more expendable income to enjoy yourself with.
When you’re buried under a mountain of debt it seems like you’re never going to get out. But there is light at the end of the tunnel.
This is a collaborative post.