Finding yourself in debt is more common than not in today’s world, and being burdened with that debt can take a toll. According to Debt.org, the negative effects of living in debt include low self-esteem and impaired cognitive functioning. There is no easy way to climb out of debt, but there are several small steps you can start with today. Here are some ideas to help you celebrate your independence and break free from your debt.
Getting started
This may be one of the more challenging areas to get through. Where do you start? How much should you allocate toward paying off your debt? Money guru and talk radio host, Dave Ramsey, offers a great rule-of-thumb for those of us just beginning a debt-free journey.
- List your debts from smallest to largest regardless of interest rate.
- Attack the smallest debt with a vengeance while making minimum payments on the rest of your debts.
- Once you pay off the smallest debt, take that payment and apply it to your next-smallest debt.
- Repeat this method as you plow your way through debt.
Frugal Moves
- Work a second job if possible until you get out of debt.
- Earn extra money by working a “side hustle” online. If you can design a website, code, or proofread, find a small job that will keep you home, but earning money.
- If you are into arts and crafts, consider selling your products online, whether it’s homemade bags, jewelry, or clothing.
- Sell old clothes or other household items online that you no longer use.
- Use coupons wherever possible, but stick to items you use regularly.
- Shop second-hand for clothing, especially children’s clothing. There are several great online options like ThredUp for consignment clothing at a fraction of the cost of heading to the mall.
Curb Your Entertainment
- Most of us don’t realize we may not need cable any longer. Research how much of your programming is available to watch online for free.
- Stop going out to dinner. Eating out should be considered a luxury, and restaurants can get very expensive. Make a meal plan each week and then shop for what you need. Make it a family event and get your kids involved. See who can come up with the best meals for the lowest price.
- Sports like golfing or skiing are just a couple of examples of just how much this activities can eat into your monthly budget. Get outside to a park or look for free entertainment.
- Stop visiting your Barista. At $5 a pop, (or much more depending on how many coffees you grab a day), your family’s coffee drink dependency can really add up. Brew your coffee drinks at home. Get creative and make your family’s concoctions the way they want them.
- Cancel your gym membership and get outside for a run or a walk. It’s free, full of fresh air, and you don’t have to spend time driving to and from your workouts.
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