It’s no secret that it’s easy to get into debt, but hard to get out of it. With more and more Americans living on credit, taking out loans to fund everything from education to home improvement projects, and facing temptations to live beyond their means, it’s no surprise that as of 2017, nearly 80% of Americans reported living paycheck to paycheck – even those who made six figures.
Fortunately, there are numerous strategies and options available to consumers who want to get out of debt and work toward financial freedom. While there are no quick fixes, and each option presents a host of pros and cons, there are ample opportunities available for families who are committed to paying down their debts and starting fresh.
Here are some methods consumers are using to become debt-free. Some of the strategies may seem obvious and easy while others are a bit more complex; nonetheless, the worst option when you are in debt is to not do anything at all to consider some or all of the options below.
Increase your monthly payments
This may seem simple and intuitive, but pouring more money into each of your payments will chip away at your debt much faster and save you on interest over time. If you have the extra revenue to commit to your debt, consider making that choice instead of spending or investing it.
Don’t accrue more debt
This, too, is simple – but many consumers fall into this trap again and again. While the conventional wisdom considers certain types of debt “less bad” than others (e.g., mortgages, car payments, and student loans), it may be best to refrain from taking on another loan when you’re in the trenches of paying one off.
Start with one debt at a time
Rather than attempting to tackle all of your debts at once, work through them one at a time to reduce overwhelm. It’s advisable to pick the one with the highest interest rate first, moving through the rest of your debts subsequently in descending order of their rates.
Get a Debt Consolidation loan
Debt consolidation loan is a popular option for consumers looking to simplify and streamline their payments. There are several types of consolidation loans, from credit card loan balance transfers to an unsecured personal loan, that can help you simplify your debts by making one payment rather than juggling multiple amounts owed and payment deadlines.
Pick up a side job
Side-hustling is a fantastic way to tackle debt. However, keep in mind that if you devote the extra time and energy to a second job, the key is discipline: Commit to using your income from your side job only to pay off your debts and resist the temptation to spend it elsewhere.
Explore Debt Relief Options
A reputable debt relief company like ours can help you evaluate your various options, weigh the pros and cons of each, and help you as you work toward paying off your debts. Some companies will even serve as an intermediary between you and your creditors, taking the responsibility of negotiating and managing your loans off your plate.
Getting out of debt isn’t easy, but it’s doable – and you have options. If you have questions about your debt relief options and would like to learn more about how we can help you, we welcome you to contact us.