It\u2019s no secret that most people are dealing with some form of debt.\u00a0 The biggest culprits being mortgages, student loans and credit cards.\u00a0 Carrying a balance each month can feel like a never-ending cycle, but it is possible to get out of debt.\u00a0 You just need to make a plan and follow through.\u00a0 Here\u2019s how you can pay off your debt quickly and regain control of your financial life.<\/p>\r\n\r\n\r\n\r\n
You\u2019re never going to be debt-free if you don\u2019t change the habits that got you into trouble in the first place. Therefore, you need stop using your credit cards. Cut them up or tuck them away. Next, go through your social media<\/a> and unfollow every brand on your timeline. There\u2019s no need to know about the latest product releases because you won\u2019t be buying any of it. Unsubscribe from all retailer mailing lists too. If you have your credit card information saved anywhere, delete it so you can\u2019t easily give in to a moment of weakness.<\/p>\r\n\r\n\r\n\r\n You\u2019ll never know how bad your debt really is until you crunch the numbers. So, it\u2019s time to face the music. Gather your latest statements and create a list of your debts. Include everything listed on your credit reports as well as any money you may have borrowed from family or friends. Your list must clearly state who you owe, the amount, interest rate, due date and minimum monthly payments.<\/p>\r\n\r\n\r\n\r\n Sometimes the hardest part of starting a debt free journey is knowing where to begin. Rather than get discouraged, start with the smallest balance and work your way up. This is known as the snowball method. How it works is you\u2019ll focus most of your efforts on eliminating the smallest balance while making minimum payments on the rest of your bills. Once that\u2019s out the way, you\u2019ll move on to the second lowest bill and repeat the process until everything is paid off.<\/p>\r\n\r\n\r\n\r\n A cheaper – and better – alternative is to start with the bills that are costing you the most money. Rank your bills from the highest to lowest interest rate. This is the order in which you\u2019ll pay your monthly bills. Most of your money needs to go towards the debt with the highest interest rate but you still need to make the minimum payments on the rest of your bills. From there, you\u2019ll just work your way down the list.<\/p>\r\n\r\n\r\n\r\n Not everyone is struggling to pay off a mountain of debt.\u00a0 Some people just have a large credit card balance they\u2019d like to get rid of.\u00a0 In that case, using a payoff calculator<\/a> can be helpful.\u00a0 Simply enter your credit card balance along with the interest rate and when you\u2019d like to be debt-free.\u00a0 Based on the information, they\u2019ll tell you the monthly payment needed to eliminate your debt within the given time frame.\u00a0<\/p>\r\n\r\n\r\n\r\n You can\u2019t get ahead if you\u2019re foggy about your finances. A budget<\/a> is most people\u2019s least favorite “B” word, but most experts recommend having one because it works. Knowing how much money you have coming in versus going out each month makes it easier to keep your spending in check. You won\u2019t have to play a guessing a game about where your money went because you\u2019ll have all the facts in front of you. Having a budget can also help you come up with a solid payment plan. Open the calendar app in your phone and write down all your bill due dates. By doing so you can plan how each check will be spent and ensure the bills are paid on time.<\/p>\r\n\r\n\r\n\r\n Not everyone can be trusted with a credit card. Be honest with yourself and understand your limitations. A good way to stop impulsive shopping is to use the cash envelope system. From this point on you\u2019ll be relying on cash for everything. Look at your budget to pinpoint your common spending areas. Each category will have its own envelope along with a dollar amount. The goal is stick to the allocated amount and not borrow from the other envelopes. We suggest keeping a tally on the front of each envelope so it\u2019s easy to see when you\u2019re starting to run low.<\/p>\r\n\r\n\r\n\r\n If you\u2019re trying to get out of debt as quick as possible relying solely on your 9-5 won\u2019t cut it.\u00a0 Earning more money will allow you to pay your debt off faster.\u00a0 There are plenty of ways you can easily earn an extra $500 a month.\u00a0 If you stick to the plan for an entire year, that’s $6,000 of debt eliminated.\u00a0 That\u2019s not even considering the money from your full-time job.\u00a0 Some side hustles you can do to earn money are tutoring, fixing computers, detailing cars or event planning.<\/p>\r\n\r\n\r\n\r\n According to Goodwill<\/a>, 80% of the things we keep never get used.\u00a0 Therefore, it\u2019s time to eliminate some of the clutter from your home.\u00a0 Go through your belongings, create a pile of everything you don\u2019t mind parting with and put it up for sale.\u00a0 You can go the traditional route and have a yard sale or list the items online, whichever is more convenient for you.\u00a0 All your profits must go towards your debt repayment.<\/p>\r\n\r\n\r\n\r\n Don\u2019t be scared to ask for what you want.\u00a0 Creditcards.com<\/a> conducted a survey among credit card holders and found that 56 percent of people who requested a lower interest rate got it.\u00a0 Meanwhile, 84 percent of people were able to get their late fee waived just by asking.<\/p>\r\n\r\n\r\n\r\nMake a list of your debts<\/strong><\/h2>\r\n\r\n\r\n\r\n
Start with the lowest balance if you’re unsure where to begin<\/strong><\/h2>\r\n\r\n\r\n\r\n
Save money by paying the highest interest rate first<\/strong><\/h2>\r\n\r\n\r\n\r\n
Use a credit card payoff calculator<\/strong><\/h2>\r\n\r\n\r\n\r\n
Create a budget and live within your means<\/strong><\/h2>\r\n\r\n\r\n\r\n
Swap your credit cards for cash<\/strong><\/h2>\r\n\r\n\r\n\r\n
Get a side gig to earn more money<\/strong><\/h2>\r\n\r\n\r\n\r\n
Turn your clutter into extra cash<\/strong><\/h2>\r\n\r\n\r\n\r\n
Ask for a lower interest rate on your credit cards<\/strong><\/h2>\r\n\r\n\r\n\r\n