Although everyone’s financial story is different, many who are in debt can relate to these two common themes: falling into debt happened quickly, and the original amount of debt multiplied fast. It’s important to address your debt head-on and pay it off as soon as you can, but getting started on the debt-free journey can be tricky.
Why Paying Off Debt Can Be Difficult
It’s easy to feel helpless when you’re deep in debt. Depending on the size of your debt and how you’re approaching it, the time that it takes to pay everything off can be discouraging. Emergency expenses and increasing interest rates will still add to your growing debt, which makes it harder to come out on top financially. Additionally, paying off debt requires sacrifices and lifestyle changes, which many individuals have trouble adjusting to.
How to Pay Off Debt Quickly
Paying off debt requires self-control, dedication and focus, but it is possible. Below are some common ways to address your financial burdens:
- Stop Using Credit Cards: Responsible credit card use can help you build your credit score, allow you to cash in on reward programs and provide you with aid in an emergency. Unfortunately, the “out of sight, out of mind” effect that credit cards have on your spending habits can easily result in overspending. Try switching out the credit cards in your wallet for cash - by eliminating the temptation to “borrow” money with your credit card and limiting yourself to the physical paper and coin money that you have in your pocket, you’ll likely make wiser spending choices.
- Pay More Than the Minimum: Avoid racking up unnecessary interest by paying more than your minimum monthly payments.
- Build a Budget and Make Smart Spending Cuts: Analyze your current income and total expenses and compare them to your financial goals. Is your daily $5 latte getting in the way of your credit card payments? Can you do without a subscription streaming service and instead put that money towards your student loans? Build a smart budget that focuses on paying for the essentials, chipping away at your debts, and setting aside money for your emergency fund.
- Put Your “Surprise Money” Towards Your Debt: It’s tempting to treat tax refunds, bonuses and monetary gifts as “fun money,” but the additional cash flow can help you rise out of debt faster if you put it towards your bills.
- Get a Side Hustle: Second jobs and freelance gigs can provide you with the extra cash needed to pay down your financial obligations. Whether you land a traditional part-time job, drive for an on-demand service, walk dogs, work on a side project or sell items online, you can use your additional funds to pay off debts more quickly than you would on a 40-hour paycheck alone.
- Try a Repayment Strategy: The right game plan can make all the difference when it comes to paying down your debt. Consider either the debt snowball or debt avalanche methods to reframe your finances and tackle your payments.
Should I Pay Off Debt Fast?
Putting your debts behind you allows you to put your money towards the things you care about most. Once your credit cards and personal loans are paid in full, you can invest in your retirement, pay for preventative care and save up for a home upgrade or family vacation. Working your way out of debt takes time and dedication, but the financial freedom you’ll experience after paying off your financial obligations is worth the effort.
Accredited Debt Relief’s financial services can help you pay off your debts sooner. Our BBB accredited team has helped many throughout the U.S. with their debt repayment goals. Contact us today for a free, no obligation consultation.