Tired of mounting credit card and student loan debt? Do you feel like you’ll never pay off your debts with all that interest? Learn my tried and true tips on how to get out of debt faster!
You open up the latest credit card statement. Every month you send in payment. And every month, the balance seems to hardly move. Frustration sets in.
I know how you feel. When I got divorced, I was left with nearly $10,000 in credit card debt. Plus student loans, a car loan, and a mortgage.
The strategies highlighted below helped me pay off my debt faster–I paid off the nearly $10K in credit card debt in under a year!
How to pay off debt faster
1. Cut unused subscriptions
These days it seems everything requires a subscription or recurring fee.
Streaming movies. Music services. Storage backups. Gym memberships. Subscription boxes.
How many of these services are you actually using?
Pull out your bank statement and review it for any subscription charges. Think about whether you are actually using the service. Is it something you can cut to have more funds to put toward your debt payments?
Be honest with yourself: When was the last time you used everything in that makeup subscription box or went to the gym?
Instead of throwing money away on something you aren’t using, put those funds toward your debt repayment.
2. Live with a bare-bones budget
Now take a look at your monthly bills. Is there any that you can reduce or eliminate all together?
For example, swapping out cable for a streaming service like Netflix or Hulu can easily add $50+ a month to your bottom line.
Skip a dinner night out, slash your grocery bill, refrain from purchasing new clothes, or downgrade your cell phone plan. When you are ready to get serious about conquering your debt, it’s time to cut any extra expense you can think of so you can put that money to your debts.
3. Take advantage of “extra” money
There’s plenty of instances where you might have income that you didn’t include in your monthly budget. This “extra” money is a great way to speed up your debt payoff!
Where you might find extra money:
- Commissions/sales bonuses
- Birthday money
- Mileage reimbursements from your employer
- Holiday/year-end bonuses from work
- Tax refunds
If you get paid weekly or every other week, there are a couple months a year you will get an extra check in a month. Putting an entire extra paycheck towards your debt repayment makes a big dent!
4. Find ways to earn extra money
Earn more at work
See if you can pick up extra hours or even overtime at work. Even a few hours here and there add up! Is there any opportunities to add commissions or bonuses above and beyond your current income?
Take on a second job
Adding a part-time job can really give you an extra income boost. If you have weekends free from your primary job, use that time to make some cash!
From delivering pizzas, waiting tables, or working retail, there’s plenty of opportunities to work part-time. The holidays are a great time to find part-time retail jobs and score discounts at the same time!
Start a side hustle
A side hustle is great way to continually add extra income to your budget and provides a safety net if something happened with your primary job. Start a blog, drive for Uber, get a pet sitting gig, or sell crafts on Etsy.
5. Change your tax withholdings
Did you get a sizable refund last year?
If so, check with your tax preparer/accountant if you can have less withheld from your paycheck. You’ll get a smaller refund next year, but you’ll be able to have a bigger monthly budget for debt payments.
6. Focus on one debt
When we have a large amount of debt, the total amount owed can be overwhelming. Start with the smallest debt and focus on paying that one off.
When you add little extra payments to various cards, it’s easy to feel like you aren’t making any progress. But once you put all the extra money from these strategies to just one debt, you’ll start seeing that balance decrease!
7. Make automatic payments
Instead of writing a check each month, set up an automatic payment to pay your bill. When we set up things to happen automatically, we are less likely to change them (because of the hassle).
Be sure that you set up your automatic payment for an amount greater than your minimum for maximum debt repayment progress!
Simple ways to pay off your debt faster
Little changes can add up to big results when it comes to paying off your debt. Finding ways to save money plus earning extra income can bring financial freedom sooner!