8 Easy to Implement Debt Elimination Tips
When you’re in debt, it can feel like the world is about to swallow you whole. Stress and anxiety are common emotions and the desire for financial freedom can feel like a faraway dream. The good news is, like most things, a few steps in the right direction can make all the difference. It can help build up momentum and hope that you will eventually recover and be debt-free. However, you do need to take the first step. To help steer you in the right direction, try one of these easy-to-implement debt elimination tips.
1. Spend less than you earn.
This is probably the most common sense tip on this list, yet when you look around, it can seem like no one applies it. To help combat the urge for more stuff, keep a note in your wallet that has the question, “Do you really need this?” attached to it. If you tend to buy stuff impulsively online, keep the note on your computer as well. Remember that every dollar you spend on something other than decreasing your debt is just prolonging the inevitable. The debt isn’t going away, and neither is the interest that keeps growing.
2. Make your own meals.
If you eat out, keep track of how much you spend each week on food, coffee, etc. Chances are you spending a lot more than you thought. Even a $2 coffee every day adds up to around $60 a month. That’s at least a tank of gas or a monthly payment on a bill. Save that money and focus more on making your own meals. Not only will it save you money, but it’s also healthier.
3. Find more “freebie” entertainment options.
Entertainment can eat up a considerable amount of your monthly budget if you’re not careful. Help save more money by looking for cheap or free alternatives for your favorite entertainment options. Instead of going to the movies, spend a dollar or two at Redbox and rent one instead. Even better, sign up for their monthly freebies club by texting REDBOX to 727272. Each month, they will send you a code for a free movie.
4. Plan for upcoming expenses.
Stay in charge of your finances by avoiding unexpected debt or bills. Keep a list of monthly recurring charges and any upcoming bills that you may be expecting. Make sure to anticipate extra expenses such as travel, birthdays and holidays. Being prepared can help make sure you don’t end up spending the money on something else.
5. Pay the smallest debts off first and work your way up towards the larger ones.
If you try to wait until you have the money to pay of your largest debts, you may be waiting forever. Sometimes you need a little positive momentum to help get you moving in the right direction. An easy way to do this is to focus on your smallest bills first and get them paid off. It’s extremely rewarding to be able to check off debts as completely paid, and it will help you find the resolve to tackle your larger debts.
6. Understand your spending habits.
You can’t fix something if you don’t really understand it. When it comes to your finances, you have to know your weaknesses and your strengths in order to make a real change. If you know you’re an impulse buyer, make sure you only bring enough cash to purchase what you went into the store to purchase. Leave everything else in the car or at home. Take a look at your last few month’s purchases and see if you notice any trends that you can create new habits to overcome.
7. Cut down on things you could do without.
It’s easier to save money when you aren’t spending it. Are there things you could “do without.” Do you really need cable TV? What about monthly recurring fees? Even if they are only five or ten dollars, if you have a number of them, the amounts can add up quickly. Go through all your current bills and see what things you can eliminate.
8. Don’t borrow money.
Incurring new debt to pay off old debt doesn’t actually help lower the amount you owe. You just have a new debtor to pay off instead. You would be better served by looking at ideas on how to reduce your spending and increase your income. It would be better to have to sell off a few things and downsize than to incur any new debt.