Many of us don’t get rid of debt because it seems like such a daunting task. After all our debts are often as large as a year’s income. We may be able to remove debt but it may not work well with keeping up the lifestyle we have chosen. However, that debt needs to be paid off, so here are a few ways to make going debt free a little less painful.
Sometimes it just isn’t possible to pay off your entire consolidated debt at once. Even if you have the means your mind goes to all sorts of “what if” places about if you spend all that money at once. Instead start by paying off your smallest debts. Then take the money you were paying into your smallest debt and let it snowball into your next smallest debt. Continue this process until you no longer have debt payments. Use the money you paid for debts to start saving and investing towards your future.
Get Rid of Temptation
Cut up old credit cards and tear up new credit card offers. Don’t let them be a temptation to spend money you don’t have. If you do need a credit cushion have an overdraft account on your checking account (usually $500) that will protect your payments should you spend more than you should.
Get a smaller house. Get a smaller apartment. Have only one family car. Downsize your insurance coverage from full to liability. Bring a homemade lunch to work. Move closer to work to reduce gas usage. Use blankets instead of turning up the heat. Get rid of cable. Remove useless entertainment and replace it with useful hobbies such as creating clothes or blankets or trying new recipes. You could use these things for your family or sell them to earn some extra money on the side.
What are your best tips for getting out of debt?
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