You’re deep in debt and you want to get out fast. The problem has become so overwhelming that you no longer know where to start. To help you get back on your feet, here are some tried and tested tips for getting rid of debts.
Tip # 1 – Earn more money
How can you pay off your debts if you do not have any money? The first step in resolving your debts is to earn more money. If your primary income is not enough to cover your monthly debt payment, you should seek ways to generate more earnings.
Some ideas to consider:
- Get a second job
- Work a part-time job
- Start a business
- Get an online gig
It’s good to know that there are now many side gigs that you can get online. Some of the sites that you can get started with include:
- Gigwalk – This is an easy-to-use site where you can find many good-paying micro jobs.
- Field Agent – This website pays its members to check prices in the market and scan barcodes.
- Kango – Kango is a website that provides jobs for people who want to provide childcare.
- Instacart – With Instacart, you can get linked with people who would want to use your services to pick up and deliver groceries.
- TaskRabbit – This is a site that offers a wide array of odd jobs that you would want to try.
- Airbnb – If you have an extra space in your house, you can rent it out at Airbnb.
- Upwork – Upwork is the largest freelancing site where you can jobs working as a writer, graphic artist, web developer, tutor, virtual assistant, data encoder and many more.
Tip # 2 – Go on a spending diet
Aside from earning more money, you need to work hard to minimize spending. Even if you are earning extra money, if you don’t change your unwise spending habits, you will still be buried under a pile of debts.
Here are some techniques to help you tone down on your spending:
- Find out where your money goes – Keep a record of all your expenses so you can see clearly where your money is going. This will show you which area you typically overspend so you can do something about this.
- Stay away from temptations – If you find yourself buying things you don’t need each time you pass by a discount sale at the mall, then make it a point to stay away from those.
- Allot a specific amount for your lifestyle expenses – So you don’t deprive yourself of every enjoyable thing that you do, it will be a good idea to set a specific budget for your lifestyle expenses. This will also help you trim down your expenses.
Tip # 3 – Consolidate your debts
Debt consolidation is a process in which you combine several debts into one so you only have to make a single payment each month. This will enable you to manage your debts more efficiently, and even help you to get rid of them more quickly. But you have to be careful as there are many myths surrounding debt consolidation that you have to know so you can make informed choices.
Tip # 4 – Make a budget and stick to it
Having a budget not only ensures that you cover your basic expenses, but you also set aside money for your debt payments. To do this effectively, you have to review your expenses each month, and then write down a budget allocating each portion of your income to your expenses. Be sure to include payment for your debts. Of course, the budget will not be of any use if you do not follow it. If you find yourself short in cash, go back to tip # 1 and earn more money to make your budget work for you.
Tip # 5 – Prevent future debt
Be proactive in preventing debt from happening again. Once you have resolved it, make significant chances in your spending habits so you don’t have to suffer the same problem. Consulting a financial advisor can also be helpful if you are clueless in financial planning.
Getting out of debt can be done more quickly if you really put your mind to it, and if you take the necessary steps to earn more money, reduce spending, manage debt more efficiently, and prevent debts in the future.