How to Get Out of Debt Fast: 7 Tips for Pushing Past Debt
Debt is a scary word for many and with good reason. It can be hard to get out of debt, but it isn’t impossible. You just need the right strategy to do so. This post will provide you with some tips and ideas on how to pay off your debt quickly and easily!
The average American has $90,460 in debt, according to a recent report from CNBC. If you’re like most people, it’s hard to get ahead when you can’t even pay off your debts.
It doesn’t have to be this way. With the right strategy, it is possible to get out from under the burden of your current financial situation. All you need is a little bit of know-how and some extra effort on your part. This guide will teach you how to use strategies that are proven effective at getting rid of your debt quickly and easily while still enjoying life with no regrets!
How to Pay Off Debt Fast
Being buried under a mountain of debt can be very intimidating. It’s hard to think about how you could become debt-free but learning the secrets for quickly paying off your debts will require some work and sacrifices on your part. It might not be easy but it will be so worth it in the end!
It can be done quickly if you’re willing to put in the effort and it’s possible even though sometimes, we might feel like it is too much.
#1 Know what you owe.
When you are unsure of how much debt you truly have, it is hard to confidently say that all your bills and debts are paid off. However, the first step in paying off your debt completely starts with adding up everything you owe. This number will be your long term pay off goal.
You can get a free copy of your credit report from annualcreditreport.com to help you with the first step. They allow one free credit report per year from all three agencies. If you want to be sure that all your debt is included, then request a copy from each agency before working on paying off debt.
#2 Set a debt-free goal date.
Many people don’t set a goal date when they start paying off their debt. But the majority of us need a solid deadline in order to get motivated.
Before you start, look at how much debt you have. For instance, if you owe $10,000, try to pay off $1,000 first. You may want to pay the entire $10,000 as soon as possible because of bad interest rates, but if your goal is too high and it can get overwhelming quickly, so aim for smaller goals first.
To create the “snowball” effect, break your goals into smaller steps. Breaking your goals down into more manageable steps will help you pay off debt faster. If $1,000 is too much to reach for at once, start with $100.
Whatever amount you choose is fine. You should not compare yourself with others. The only person you are competing with here is yourself!
Setting a debt-free goal date means you need to include your debt pay off in your budget each week. How much can you afford to put towards your debts each week? Giving yourself a deadline can make you feel more motivated, use that as encouragement to get your work done!
After you have your mini-goal, make a date for when this will happen. If your goal is $100 and you know you can save an extra $50 each week, set the date about 2 weeks from now. You want to be able to do this but also want it to be realistic so that it pushes you. Without deadlines, there is more room for slacking.
#3 Reduce all possible expenses.
To get out of debt, you need to cut spending. It is especially important if you do not have a lot of extra money that you can put toward your debt monthly. This is where you have to make sacrifices and be strict about your budget.
Best ways to pay off debt fast: make your morning coffee at home, reduce how often you eat out and look into lowering monthly bills for things like internet, cable and car insurance.
This phase may be difficult at first, but you’ll grow to adjust. The more often you say “no” when tempted with a purchase or fast food option, the easier it gets.
#4 Reach out to creditors.
Although it might not be common knowledge, some creditors will negotiate the total amount of your debt with you. Use that to your advantage! Debt negotiations can lead to you owing a lot less than when you first started.
There’s no way to know if a creditor is willing to negotiate unless you contact them. However, do be aware that this may give the creditor your phone number, which will result in more collections calls.
#5 Use the Snowball Method.
One of the best methods for paying off debt is the Snowball method, which was popularized by financial guru Dave Ramsey.
The process is relatively simple. You will start by paying off the smallest debt owed at it’s smallest payment monthly. Once you’ve paid off one of your debts, focus on paying off the next-smallest. Make sure to roll the old monthly payment into your new debt repayment plan.
You will make larger payments resulting in interest compounded over time, and you should prioritize the highest-interest debt first. To pay off debt quickly, you should not be stingy with the money used to pay your total debt down.
Every extra penny should go toward making progress in your debt repayment campaign. If you’re not dedicating extra income to paying off your debt, it will take a long time (much longer than you want) to pay your debt all the way down.
One painless way to use every penny is to set your bank account settings so that each time you make a purchase, the money is rounded up and then automatically deposited into an appropriate savings account.
So, for instance, if you go to the grocery store and spend $83.45, you will have $.55 rounded up and put into another savings or checking account. Then, use the money in that savings account to pay extra money on your debt payments.
You can always pick up a side job to help you bring in extra cash if you’re trying to pay off your debt as fast as possible. The extra effort may be worth it if you are trying to clear your debt as quickly as possible.
#6 Track your progress.
It may sound like common sense – but it is still worth talking about. Keeping a debt payment tracker can help you keep going when things get hard. You will see how much progress you have made and not give up so easily.
You can make your debt tracker as simple or complex as you want. Some people like to use planners with graphs and boards. Others just need a blank thermometer printable taped to the wall.
To keep your motivation for paying off your debt, put the reminder in a place that you will see it often. When you make payments on your debt, remember that you are one step closer to being completely debt-free.
#7 Understand the journey.
You will get discouraged when you want to pay off your debt – and that’s normal! It’s part of the journey to being debt-free. If you are trying to pay it off as fast as possible, then frustration can grow when things don’t happen quickly enough.
Paying off debt can be hard. It takes a lot of time and is sometimes sad. Other times, you will envy friends who are not worried about their debt and you will want to spend more money.
You may want to quit or feel angry when you’re in debt. Just know that it is normal. You will get past it! It is all part of the journey.
If you feel any of these emotions, know that you are not alone and it is normal. You will get past the feelings! It is all part of the process.
In the long run, if you work hard to become debt-free, you will be very happy.
Free Printable Debt Payoff Tracker
How to Get Access
I hope you’ve found these tips and ideas to be helpful in your journey of pushing past debt. It can seem like an uphill battle, but it doesn’t have to be so hard if you start with the right steps forward.