HOW TO GET OUT OF DEBT FAST: 7 TIPS YOU CAN
START USING IMMEDIATELY I meet with people every day who have too
much debt. There are some common themes. So this Brandon’s Blog is taking those common
themes to give you seven quick ways to find extra money so you can know how to get out
of debt fast. By fast, I don’t mean immediately. I mean a lot faster than you can do on your
own. It is not your fault that you have not been
able to get out of debt yet. The reason is that you have never been shown these tips
before. Or, if you do know some or all of them, you have not been properly motivated
yet to start using them. So I am writing this Brandon’s Blog as much
to motivate as to provide information. How do I get myself out of debt?
The concepts I am going to discuss have taught many people how to get out of debt fast. These
suggestions will certainly equip you to discover cash in your budget plan and also get yourself
out of debt. I’ll then offer you three more steps to entirely
repay your debt. It will aid you with benefit approaches to facing those greatest difficulties
in being debt-free. Utilizing these methods to repay your debt will put you on the path
to building your credit rating score back up.
Warning on how to be debt-free fast I’ve got to put a little warning here. If
you are trying to get totally debt-free in a fairly brief period of time, whether you’ve
got five thousand or fifty thousand of debt, it’s going to involve some difficult decisions.
You need to dedicate yourself fully to taking these steps I’m sharing with you and to stick
with it for your debt-free future. You’re probably better off just clicking out to enjoy
some pet cat videos if you’re not ready to make that commitment!
How can I reduce my debt quickly? Step 1 – Here is my first step to becoming
debt-free. This one is crucial before anything else. You need to get some quiet time and
make your personal becoming debt-free objectives real. Making those goals real does not suggest
simply thinking them out for 5 seconds. What will you do on a daily basis when you’re
debt-free? What will it feel like? How will your life be different? Write out this story
on a piece of paper. Then start making your how to get out of debt fast plan.
Step 2 – Just how much do you intend to pay off in three months? In six months? You’ll
make use of the actions explained below to create these objectives. The suggestion is
that you have some shorter-term goals of how much to save and also just how much debt to
repay. These shorter-term goals need to feed into
your longer-term 1-year goal. They’re easier to get to than that big goal. They also will
inspire you to keep going when you reach them. With your goals done, it’s time to prepare
your month-to-month budget. It is a plan of where your cash comes in from and where your
money is going. You require to take the time to write down
every source of revenue you have and also how much from each one. You also require to
recognize and write down where the money is going. As soon as you have actually done that,
your very first big money-saver is going to be to plan spending challenges.
Now I know I just lost half of you. This isn’t a budgeting blog per se. You need to develop
your budget on your own. I have written other blogs on the topic of budgeting which you
can read here. Step 3 – I like these fast little bursts of
saving cash. As well, they’re actually going to disclose a lot concerning your spending.
The way a spending challenge functions is you take one item from your budget plan, something
you have control over like purchasing clothing, eating in restaurants or other shopping.
You’re going to challenge yourself to reduce that spending in half or eliminate it out
entirely over the next 2 months. I am not talking about going cold turkey and not spending
anything. I am speaking about a short-term challenge of a couple of months and also on
1 or 2 spending items at a time. These spending challenges work on so many
levels and I guarantee you’ll love them as much as I do. By only taking one or two
items from your budget, you’re not trying to skimp and save every penny.
You can still have fun. You’re just experimenting cutting back on a few things at a time. Besides
saving a lot of money, this is really going to show you what you don’t care about in
your budget. Even after the spending challenge, you’ll find that some of these things don’t
matter that much and you’ll keep saving money.
I know somebody that used this spending challenge concept for just 6 months and saved a great
deal of cash. They used that cash to pay down debt! These spending challenges are super-easy
to maintain since they are only for 2 months. You’re not trying to go a year without spending.
It is eight short weeks so you’ll always see the finish line.
What’s great is that eight weeks is right around the time it takes to build new habits
and break old ones. Even if you go back to spending a little more after the challenge,
those new habits are going to drive you and help you save easier. Maintaining this new
behaviour is one of the keys for how to get out of debt fast.
How to get out of debt on a low income Step 4 – Next is to do a complete decluttering.
Don’t stress, I guarantee it’s much easier than it seems. A clutter clean means going
room-to-room in your apartment, condo or house and taking out every little thing you don’t
need. Particularly those things you don’t use.
This means the treadmill you never used, those movies you never see, also the furniture you
never rest on. Anything that isn’t being used or making your life better, offer it for sale
online or where ever you can market it. Old clothes can go to a consignment shop,
videos, as well as books to a half-price book store, to sell. Not only are you making a
little money here to help pay off your financial debts, however, but you’re also ridding
yourself of what you do not make use of. It could be a challenging reality to face
the fact that you may have squandered your cash getting some of these things. But it
is that wakeup call we all need to keep us from wasting more of our money on even more
stuff. Step 5 – This is going to be another tough
decision but its one that a lot of people need to make. That is taking a cold, hard
look at how you’re getting around every day.
I like watching or listening to shows and reading about people talking about how much
debt they have. What always amazes me about these, and I see this probably 90% of the
time, is how many people have new car payments they can’t afford. Seriously, people just
don’t seem to see how a monthly $800 new car payment is wrecking their budget!
Besides the payment itself, insurance and registration are going to be more on a new
car. Now I’m not saying you can’t have nice things or that you should never buy a
new car. Perhaps a demo or a car in good condition that just came off a 3-year lease would be
more economical and save you money. Enjoy your money! We don’t have a lot of
time on this earth and you have to enjoy it. But you can’t enjoy life if you’re constantly
stressed out from the burden of that debt. So you need to take a look at what’s parked
in the driveway. If it’s a new car and you have more than
$20,000 in debt, sell that sucker or trade it in. Get a used car that’s going to save
you a few hundred a month and use it to pay down your debt!
Step 6 – This one is going to be to fight lifestyle creep. Lifestyle creep is how your
spending seems to rise along with your income so you’re always stuck in that paycheque-to-paycheque
money trap. How is it that we get tax refunds or a raise
but never have enough to save? You work overtime but the money just seems to evaporate into
thin air. It’s that problem of lifestyle creep. Our budget always seems to grow to
eat up whatever income there is. Fighting lifestyle creep just means writing
out that budget, knowing how much you’re spending and then making that effort to not
spend more just because you’ve got a little extra. The best way I’ve found to do this
is to assign all your extra money to that debt payoff plan or to a retirement investing
account. By having a place for that extra money, it
stops being extra and that temptation to fill the gap with extra spending goes away. It
might not seem like it will save much but you would be surprised how quickly regular
smaller amounts will add up. Step 7 – My last money-saving trick before
we get to those 3 debt repayment methods is going to be to freeze your credit cards. As
I have stated lots of times in the past, you simply do not get that same mental and emotional
feeling when you use a credit card that you get when you pay with cash money.
I’m not saying to cut up your cards. I have a credit card I use for business spending
and personal spending. It is also helpful to have one for emergency situations if you
don’t have a cash emergency fund. Freezing your credit cards is going to still keep that
option open yet it makes you reconsider your spending on almost every item.
Simply put, those 7 money-saving hacks are going to provide you with thousands to plan
with to pay off debt quickly. None of them are awfully hard and I assure you they will
help put you back on the right track. How can I pay off 5000 in debt fast?
Now I want to share three more debt strategies. These are ways to pay off your debt and restructuring
your debt to get it paid off as fast as possible. You need to know how to prioritize your debt
payoff. It is amazing how just a little tweak in how you pay your bills can mean a huge
difference in getting debt-free. There are two debt payoff strategies that
I’ve talked about in Brandon’s Blog quite a bit: (i) the avalanche method; and (ii)
the debt snowball method. Picking one of these two strategies is going to help you save money
on interest and motivate you when budgeting gets tough. I’ve detailed these two strategies
in other blogs like the one you can read by clicking here. I’ll give you the general
outline here. These two methods are very common as to how to get out of debt fast.
In the debt avalanche method, you list out your debts in order of interest rate from
the highest rate to the lowest. You still have to make minimum payments each month but
you use any extra money, the money we found from those seven savings strategies before,
to make extra payments on those with the highest rate of interest.
This method makes the most sense financially because by paying off those high-rate debts
first, you’re saving money. A lot of times, these high-rate debts are going to be the
highest payments as well so paying them off faster is going to free up a lot of room in
your budget. That other method, the debt snowball method,
means listing your debts by order of amount owed from smallest to largest. Here instead
of making those extra payments to the highest-rate debt, you’re paying more on the debts with
the lowest amount owed. That means you’re going to see these small debts fall off your
list faster. And while that avalanche method might save
the most money, that snowball method is hugely motivating. You’re going to see those debts
fall off your list fast and that’s going to help you keep going with your budget and
saving money. So think carefully about the debt snowball
vs debt avalanche methods and pick the one you think will make you feel the best. But
even if you’re not following a specific debt payoff strategy, I want you to try just
putting an extra $15 a month towards paying off your debt. Do more if you can but even
this small amount is going to go a long way and save you a lot of money.
How to pay off credit card debt The third strategy comes after picking one
of the two debt payoff strategies I just mentioned. This third strategy is to get your interest
rates lowered on the debt you have. TransUnion Canada has said that in 2018, the average
Canadian’s non-mortgage debt stood at $29,312 per person, including an average credit card
balance of $4,154. With interest rates at a minimum of 19% per annum, that means you’re
paying $166.16 a month just for the minimum monthly payment.
Using the average credit card balance, at $166.16, it would take you over 10 years to
pay off $4,154. If the entire average non-mortgage debt of $29,312 is credit card debt, then
the minimum monthly payment would be $1,172.48. It would take 17.4 years to pay off the balance.
That’s going to make it impossible to get out ahead so we’re going to focus first
on these cards to lower our rates. The first thing you can do is just call the
credit card company and ask for a six-month introductory rate. Tell them you’re thinking
about a balance transfer to a zero percent rate you are being offered by another credit
card issuer, but you’d like to stick with them if they’ll match the offer. A lot of
times, this is all it takes. Getting a six-month introductory rate on that
average balance means you’ll save almost $1,000 on a call that takes all of five minutes
to make. If your credit card company won’t lower your rate, then start looking for those
introductory rate cards and make a balance transfer. Either way, you’re going to be
saving money that you can put into faster debt payoff.
Another option is going to be to just consolidate your debt into a personal loan. This means
taking out a signature loan from a bank to pay off those high-rate cards. IF you still
have a decent credit score and a job, then hopefully you can qualify for a personal loan.
With a personal loan which probably has an interest rate 10% lower than the credit card
rate, you’ll save hundreds of dollars, and you’ll get a fixed payment and a payoff
date instead of that hamster wheel of credit cards.
How to get out of debt on a low income Now you’ve got 7 financial concepts and 2
debt payoff techniques to help you pay down your debt. But I want to talk to you about
one more action that most people miss out on. It is essential to creating your financial
future. The problem is that so many people living paycheque to paycheque are only looking
at their finances from one side of the equation. They get into debt or are trying to get out
ahead and they immediately go to budgeting and saving money. But how realistic is that
when your budget is already cut to the bone? They claim you cannot squeeze blood from a
rock and you cannot save money from a budget that is barely sufficient to make ends meet
as it is. Instead, what I want you to do is to look at this from the other side of the
formula. Do not check out it simply from the side of saving money but actually making even
more cash also. This doesn’t mean getting a 2nd job. It can
be as easy as investing simply five or 10 hours a week in a side hustle, making that
additional $200 a week to help pay for your debt much faster. You’re not only going to
be paying down debt. You likewise are going to be happier due to the fact that every little
thing isn’t depending upon skimping and cutting your spending plan to live like a miser.
Doing all this, you’re going to be impressed at exactly how quick you repay your debt.
When you get out from under that constant burden of debt I want you to feel it. It is
a great sensation. Summary
I hope you found this Brandon’s Blog on how to get out of debt fast and my tips to
pay off your debt helpful. Sometimes though things are too far gone and more drastic and
immediate triage action is required. Do you have too much debt? Are you in need
of financial restructuring? The financial restructuring process is complex. The Ira
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You are worried because you are facing significant financial challenges.
It is not your fault that you are in this situation. You have been only shown the old
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The stress placed upon you is huge. We understand your pain points. We look at your entire situation
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The way we take the load off of your shoulders and devise a debt settlement plan, we know
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