3 easy ways to get out of debt

Contents
  1. How to Get Debt: 7 Tips That Work
  2. Make the most of every dollar
  3. Align your spending and values
  4. 11 Ways to Get Debt Faster
  5. Steps to get debt faster
  6. 1. Pay more than the minimum payment
  7. 2. Try the debt snowball method
  8. 3. Pick up a side hustle
  9. 4. Create (and live with) a bare-bones budget
  10. 5. Sell everything you don’t need
  11. 6. Get a seasonal, part-time job
  12. 7. Ask for lower interest rates on your credit cards — and negotiate other bills
  13. 8. Consider a balance transfer
  14. 9. Use ‘found money’ to pay off balances
  15. 10. Drop expensive habits
  16. 11. Step away from the _____
  17. 3 easy ways to get debt
  18. 1. Take out a personal loan
  19. 2. Take out a debt consolidation loan
  20. 3. Get a balance transfer card
  21. 4. Use the debt snowball or debt avalanche methods
  22. 10 Steps and Strategies to Getting Debt in Less Than a Year – AARP Eve..
  23. 1. Bump up your debt repayment percentage
  24. 2. Use savings to pay down larger debts
  25. 4. Use your tax refund check to pay down debt
  26. 5. Sell items for cash
  27. 6. Consider cashing in your life insurance
  28. 8. Do a credit card balance transfer
  29. 9. Use a statute of limitations law to eliminate old debt
  30. 10. File bankruptcy to discharge your credit card debts
  31. 25 Ways to Get Debt
  32. How to Pay Off Debt: The Debt Snowball Method
  33. 1. Start couponing.
  34. 2. Try consignment shopping.
  35. 3. Cut the cable.
  36. 4. Stop going out to eat.
  37. 5. Break up with your barista.
  38. 6. Visit the library.
  39. 7. Plan your grocery trips.
  40. 8. Avoid expensive hobbies.
  41. 9. Ditch the gym membership.
  42. 10. Find free entertainment.
  43. 11. Start a side gig.
  44. 12. Get a part-time job.
  45. 13. Sell the car!
  46. 14. Cut up your credit cards.
  47. 15. Use the envelope system.
  48. 16. Stop investing.
  49. 17. Ignore your broke friends.
  50. 18. Make a budget!
  51. 19. Tell the kids you’re on a budget.
  52. 20. Listen to The Dave Ramsey Show.
  53. 21. Ask for a raise.
  54. 22. Learn to say no.
  55. 23. Sell items on Marketplace or Craigslist.
  56. 24. Give more.
  57. 25. Take control of your money with Financial Peace University.

How to Get Debt: 7 Tips That Work

3 easy ways to get out of debt

Getting debt is something you can do yourself with the right tools and motivation.

Take it from those who’ve been there. The people profiled in NerdWallet’s How I Ditched Debt series tackled thousands of dollars of debt using smart strategies and everyday tricks: making the most of your money, using extra payments and knowing how to stay motivated, among other strategies.

To inspire you, here are seven tips from some of their stories — and the steps you can take on your own debt payoff journey.

Make the most of every dollar

Do it yourself: Building a budget is key to any financial plan, but especially so when you’re paying off debt.

NerdWallet recommends the 50/30/20 budget: Keep essential expenses, housing, to 50% of your income. Then allocate 30% for wants, and use 20% for savings and debt pay-down. Since you’re focused on paying off your debt, you may decide to use money from your wants category to make extra debt payments. That will wipe out debt faster and help you save on interest.

Once you have your budget, track your progress. You can set yourself up for success by automating as much as possible. You can always revise your budget as necessary.

Get inspired: Stephanie Stiavetti wanted to trade her tech job for a career in food and cooking, but $64,000 in student loan and credit card debt was holding her back.

Stiavetti’s plan involved putting almost every extra penny toward paying off debt. “I still went out with friends and enjoyed the occasional vacation, but I did so with an eye toward budget spending and found ways to make the most of every dollar instead of indulging in expensive luxuries,” she says.

Do it yourself: Consider any skills you have, such as web design or coding, that you can offer to earn extra cash. There are also side jobs you can pick up from home, selling old clothes online or renting out a room on Airbnb.

If taking a second job sounds exhausting, make it a short-term stint to earn enough for a few extra payments toward debt. Here are 25 side hustles to consider.

Get inspired: By age 23, Michelle Schroeder-Gardner had three college degrees, a new husband, a house in Missouri and $38,000 in student debt. She was determined to pay it off as quickly as possible.

Her strategy? Earn more. “Cutting your budget is great, but there’s only so much you can cut,” she says. “You can always try to make more money.”

In addition to her day job, Schroeder-Gardner ramped up several side hustles, including writing a blog, selling items from around her house, taking surveys and being a mystery shopper.

The long hours — up to 100 per week — were tough. But “just watching my debt go down kept me motivated, because I could see the end goal,” she says.

Align your spending and values

Do it yourself: Avoid falling into big-spender territory by heeding signs of overspending. If you find yourself falling behind on savings goals, buying items boredom and breaking your own spending rules, you might be overspending.

But you can break the cycle by building a good budget, analyzing your credit card statements and working to build new habits, cooking at home instead of eating out.

Get inspired: many people trying to keep up an “appearance of having it all,” Lauren Greutman and her husband, Mark, bought an expensive home, drove luxury cars and spent freely. When Lauren found herself hiding $600 worth of new clothing from her spouse, she admitted the spending was control.

“I racked up $40,000 worth of debt behind my husband’s back and had so much shame,” she says.

In addition to downscaling their lifestyle, the Greutmans made a breakthrough when they assessed their spending in light of their values. Lauren’s advice: Make a list of everything you value in life and then list all your spending from last month. If the lists don’t match, get your spending in line with your values.

Do it yourself: Use the calculator on the debt payoff guide to see how extra payments can shorten your payoff time.

Making extra payments each month on your debt can also lower your credit utilization ratio, which in turn can improve your credit score.

Get inspired: No amount of debt is comfortable for Jackie Beck. When the amount she owed hit $147,000, including a mortgage, student and car loans, and credit cards, she became obsessed with paying it off — all of it.

She did so largely by making extra payments toward her bills. “I became consumed with paying off my student loan. I earned extra money — through online surveys, freelance writing and odd jobs from Craigslist — so I could make small additional payments,” she says. “I figured out how much faster I’d be done each time I sent in even a tiny payment.”

Do it yourself: Could a side business give you extra income to pay off debt? Think about your interests and how you might make a small business them. An animal lover could open a mobile grooming service, for instance, or a writer could pick up some freelance work.

Check out these side hustles you can start with no money.

Get inspired: After a divorce, Carrie Smith Nicholson faced $14,000 in car loan and credit card debt, an amount that triggered a resolve to alter her financial situation.

“I was on my own for the first time in my life and … could barely afford a decent apartment. There was no one around to help me this financial hole, so I knew I had to help myself,” she says.

Nicholson took a second job at a tax office, working nights and weekends, and lived on two-thirds of her income. “During tax season I worked seven days a week without any vacations or time off. It was tough, but I had a goal to be debt-free within a year,” she says.

Now debt-free, Nicholson continues to lean on herself, managing a blog that provides her main source of income.

Get inspired: When David Weliver had to decide whether to pay his rent or his credit card bill in his 20s, he felt immense guilt. “After years of carrying obscene amounts of debt, it was the first time I couldn’t meet a payment obligation,” he says.

To tackle his $80,000 in student loan, car loan and credit card debt, Weliver set up a plan that included debt consolidation. His credit union gave him a low-rate loan for around $5,000. He was able to get another loan for $12,000, at a favorable interest rate, to pay off his highest-interest credit cards.

“I made the fixed personal loan payments, and whatever was left over I put toward the higher-rate APR cards, which I paid off before the lower-rate cards,” he says.

Eventually, the strategy paid off. “I was able to pay off all of my debt in a little over three years,” Weliver says, “and I’m very glad I got debt at the stage of life that I did.”

Do it yourself: Think about your financial goals in the near and long term. Whether you’re looking for a new house or saving up for a vacation, having a clear motivation to get debt will help keep you on track.

Find more inspiration — and perhaps your own “why” — by reading other How I Ditched Debt stories.

Get inspired: Brian Brandow’s debt epiphany struck in 2010 when he told his family there would be no vacation that year. Instead, it was time to face $109,000 in debt, including five maxed-out credit cards.

The Brandows created a budget, cut expenses and used a debt management plan, eventually becoming debt-free after 50 months of repayment. Brandow’s three children provided the motivation he needed to stay focused on debt repayment.

“I didn’t want to disappoint my family,” he says. “I wanted to provide better for them.

“You’ll need to have a clear reason to want to get debt, because it’s going to be hard. It will take sacrifice. You must be mentally prepared. Having a ‘why’ will help keep you motivated.”

Источник: https://www.nerdwallet.com/article/finance/tips-for-paying-off-debt-from-people-who-did-it

11 Ways to Get Debt Faster

3 easy ways to get out of debt

We’re a nation in debt. As of late 2017, the average American carried $6,354 in credit card debt and more than $24,700 in non-mortgage debt such as car loans, according to Experian. The average student loan balance, meanwhile, has hit a record high of $34,144.

The fact is, more than half of Americans actually spend more than they earn each month, according to a Pew Research study, and use credit to bridge the gap. So it’s easy to see how so many people are struggling with debt — and why some choose to bury their heads in the sand. For many in debt, the reality of owing so much money is too much to face — so they simply choose not to.

But sometimes, disaster strikes and people are forced to confront their circumstances head-on.

A series of unfortunate events — a sudden job loss, an unexpected (and expensive) home repair, or a serious illness — can knock one’s finances so off track they can barely keep up with their monthly payments.

And it’s in these moments of disaster when we finally realize how precarious our financial situations are.

Other times, we just become sick of living paycheck to paycheck, and decide we want a better life — and that’s OK, too. You shouldn’t have to confront disaster to decide you don’t want to struggle anymore, and that you want a simpler existence. For many people, becoming debt-free the hard way is the best and only way to take control of their lives and their futures.

Steps to get debt faster

Unfortunately, the space between realizing your debt is control and actually getting debt can be wrought with hard work and heartache. No matter what kind of debt you’re in, paying it off can take years — or even decades — to get debt.

Fortunately, some strategies exist that can make paying off debt faster — and a whole lot less painful. If you’re ready to get debt, consider these tried-and-true methods:

1. Pay more than the minimum payment

If you carry the average credit card balance of $15,609, pay a typical 15% APR, and make the minimum monthly payment of $625, it will take you 13.5 years to pay it off. And that’s only if you don’t add to the balance in the meantime, which can be a challenge on its own.

Whether you’re carrying credit card debt, personal loans, or student loans, one of the best ways to pay them down sooner is to make more than the minimum monthly payment.

Doing so will not only help you save on interest throughout the life of your loan, but it will also speed up the payoff process.

To avoid any headaches, make sure your loan doesn’t charge any prepayment penalties before you get started.

If you need a nudge in this direction, you can enlist the help of some free online and mobile debt repayment tools, too, Tally, Unbury.Me, or ReadyForZero, all of which can help you chart and track your progress as you pay down balances.

2. Try the debt snowball method

If you’re in the mood to pay more than the minimum monthly payments on your credit cards and other debts, consider using the debt snowball method to speed up the process even more and build momentum.

As a first step, you’ll want to list all of the debts you owe from smallest to largest. Throw all of your excess funds at the smallest balance, while making the minimum payments on all your larger loans. Once the smallest balance is paid off, start putting that extra money toward the next smallest debt until you pay that one off, and so on.

Over time, your small balances should disappear one by one, freeing up more dollars to throw at your larger debts and loans.

This “snowball effect” allows you to pay down smaller balances first — logging a few “wins” for the psychological effect — while letting you save the largest loans for last.

Ultimately, the goal is snowballing all of your extra dollars toward your debts until they’re demolished — and you’re finally debt-free.

3. Pick up a side hustle

Attacking your debts with the debt snowball method will speed up the process, but earning more money can amplify your efforts even further. Nearly everyone has a talent or skill they can monetize, whether it’s babysitting, mowing yards, cleaning houses, or becoming a virtual assistant.

With sites TaskRabbit and Upwork.com, nearly anyone can find some way to earn extra money on the side. The key is taking any extra money you earn and using it to pay off loans right away.

  • Read more: How to Make More Money

4. Create (and live with) a bare-bones budget

If you really want to pay down debt faster, you’ll need to cut your expenses as much as you can. One tool you can create and use is a bare-bones budget. With this strategy, you’ll cut your expenses as low as they can go and live on as little as possible for as long as you can.

A bare-bones budget will look different for everyone, but it should be devoid of any “extras” going out to eat, cable television, or unnecessary spending. While you’re living on a strict budget, you should be able to pay considerably more toward your debts.

Remember, bare-bones budgets are only meant to be temporary. Once you’re debt — or a lot closer to your goal — you can start adding discretionary spending back into your monthly plan.

5. Sell everything you don’t need

If you’re looking for a way to drum up some cash quickly, it might pay to take stock of your belongings first. Most of us have stuff lying around that we rarely use and could live without if we really needed to. Why not sell your extra stuff and use the funds to pay down your debts?

If you live in a neighborhood that permits it, a good old-fashioned garage sale is normally the cheapest and easiest way to unload your unwanted belongings for a profit. Otherwise, you can consider selling your items through a consignment shop, one of the many online resellers out there, or a yard sale group.

6. Get a seasonal, part-time job

With the holidays coming up, local retailers are on the lookout for flexible, seasonal workers who can keep their stores operational during the busy, festive season. If you’re willing and able, you could pick up one of these part-time jobs and earn some extra cash to use toward your debts.

Even outside of the holidays, plenty of seasonal jobs may be available. Springtime brings the need for seasonal greenhouse workers and farm jobs, while summer calls for tour operators and all types of outdoor, temporary workers from lifeguards to landscapers. Fall brings seasonal work for haunted house attractions, pumpkin patches, and fall harvest.

The bottom line: No matter what season it is, a temporary job without a long-term commitment could be within reach.

7. Ask for lower interest rates on your credit cards — and negotiate other bills

If your credit card interest rates are so high it feels almost impossible to make headway on your balances, it’s worth calling your card issuer to negotiate. Believe it or not, asking for lower interest rates is actually quite commonplace. And if you have a solid history of paying your bills on time, there’s a good possibility of getting a lower interest rate.

Beyond credit card interest, several other types of bills can usually be negotiated down or eliminated as well — we highlighted them in Six Bills You Can Negotiate Down to Save Money. Always remember, the worst anyone can say is no. And the less you pay for your fixed expenses, the more money you can throw at your debts.

If you’re not the negotiating type, a service TrueBill can help. The app will review your purchase history to find forgotten subscriptions and other repeating fees you might want to cut from your budget, and it can even negotiate some bills down for you.

8. Consider a balance transfer

If your credit card company won’t budge on interest rates, it may be worth looking into a balance transfer. With some balance transfer offers, you can secure 0% intro APR for up to 18 months, although you might need to pay a balance transfer fee for the privilege.

If you have a credit card balance you could feasibly pay off during that time frame, transferring the balance to a card could save you money on interest while simultaneously helping you pay down debt faster.

  • Related: Best Balance Transfer Credit Cards

9. Use ‘found money’ to pay off balances

Most people come across some type of “found money” throughout the year. Maybe you get an annual raise, an inheritance, or bonus at work. Or maybe you count on a big, fat tax refund every spring. Whatever type of “found money” it is, it could go a long way toward helping you become debt-free.

Each time you come across any unusual sources of income, you can use those dollars to pay off a big chunk of debt. If you’re doing the debt snowball method, use the money to pay down your smallest balance. And if you’re left with only big balances, you can use those dollars to take a huge chunk whatever’s left.

10. Drop expensive habits

If you’re in debt and consistently coming up short each month, evaluating your habits might be the best idea yet. No matter what, it makes sense to look at the small ways you’re spending money daily. That way, you can evaluate whether those purchases are worth it — and come up with ways to minimize them or get rid of them.

If your expensive habit is smoking or drinking, that’s an easy one — quit. Alcohol and tobacco do nothing for you except stand between you and your long-term goals.

If your expensive habit is slightly less incendiary – a daily latte, restaurant lunches during work hours, or fast food — the best plan of attack is usually cutting way down with the goal of eliminating these behaviors or replacing them with something less expensive.

11. Step away from the _____

We’re all tempted by something. For many, it might be the local mall or our favorite online store. For others, it might be driving by a favorite restaurant and wishing we could pop inside for a favorite meal. And for those with a penchant for spending, having a credit card in their wallet is too much temptation to bear.

Whatever your biggest temptation is, it’s best to avoid it altogether when you’re paying down debt. When you’re constantly tempted to spend, it can be difficult to avoid new debts, let alone pay off old ones.

So, avoid temptation wherever you can, even if that means taking a different way home, avoiding the Internet, or keeping the fridge stocked so you aren’t tempted to splurge. And if you must, stash those credit cards away in a sock drawer for the time being. You can always bring them back out once you’re debt-free.

It’s easy to continue living in debt if you never have to face the reality of your situation. But when disaster strikes, you can gain a brand new outlook in a hurry. It’s also easy to get sick of the paycheck-to-paycheck lifestyle, and look for ways to get out from under the crushing weight of too many monthly payments.

No matter what type of debt you’re in — whether it’s credit card debt, student loan debt, car loans, or something else — it’s important to know there is a way out. It may not happen overnight, but a debt-free future could be yours if you create a plan — and stick with it long enough.

No matter what that plan is, any one of these strategies can help you get debt faster. And the faster you become debt-free, the quicker you can start living the life you truly want.

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What are some strategies you have used to pay down debt quickly? Have you ever tried anything on this list?

Источник: https://www.thesimpledollar.com/credit/manage-debt/11-ways-to-get-out-of-debt-faster/

3 easy ways to get debt

3 easy ways to get out of debt

No one wants to have debt weighing on their shoulders, but unfortunately millions of Americans do.

Monthly payments toward loans are the norm nowadays. College grads with student loans owe on average $32,731, with an average loan payment of $393 a month, per EducationData.org.

A recent survey by credit reporting agency Experian found the average credit cardholder owes $2,326 in credit card debt, with an average monthly bill of about $780. And don't forget home loans.

According to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey, the average application size for a purchase mortgage in the week ending Oct. 2 hit a record-high of $371,500.

Getting debt is even harder amid the coronavirus pandemic. Although U.S. unemployment declined in September by 0.5% to 7.9%, that still leaves 12.6 million Americans work, the Bureau of Labor Statistics reports.

But let's look at the silver lining: There are several ways you can pay off your debt. Making a lump-sum payment is one approach, but it may not be feasible depending on your financial situation.

Setting aside money to gradually chip away at your debts, making the minimum monthly payments, and paying bills on time are other valid options — but that will take a while.

Here are some other strategies you should consider to pay down debt:

  1. Take out a personal loan
  2. Take out a debt consolidation loan
  3. Get a balance transfer card
  4. Use the debt snowball or debt avalanche methods

1. Take out a personal loan

Total personal loan balances in the U.S. reached a high of $162 billion in the first quarter of 2020, according to the credit bureau TransUnion. When you take out this loan, you borrow a set amount of money and repay the debt over a fixed time period at a fixed interest rate. These loans are popular now because interest rates are near record lows.

According to Credible, rates are as low as 4.99%. To take advantage of these low loan rates, head to Credible's website. Enter your desired loan amount, estimated credit score, and check rates from several lenders at once.

HOW TO GET A PERSONAL LOAN DURING CORONAVIRUS

There are a couple of caveats. Consider this before you decide to take out a personal loan to pay down debt:

  1. Your loan's interest rate depends on your personal finances
  2. You'll have to stick to a budget

1.

Your loan's interest rate depends on your personal finances: Your loan’s interest rate will depend on your credit score, debt-to-income ratio (how much debt you owe across all of your accounts, divided by your gross monthly income), and lender. Borrowers with higher scores and lower debt-to-income ratios tend to qualify for the best rates, and rate offers can vary by lender.

2. You'll have to stick to a budget: Because lenders impose few restrictions on how borrowers are allowed to spend personal loans, you’ll have to be able to exert some self-control and avoid spending the money on things you don’t need, that flat-screen TV you’ve been eyeing.

Want to explore your personal loan options? Head over to Credible to compare rates and lenders within minutes.

9 OF THE BEST PERSONAL LOANS FOR 2020

2. Take out a debt consolidation loan

If you have multiple sources of debt, a consolidation loan will enable you to combine your debts into one loan so that you only need to make one payment a month.

Consequently, rolling your debts together can make your bills more manageable. Also, taking out a debt consolidation loan can potentially save you a significant sum of money over time depending on what interest rate you qualify for.

Many debt consolidation loans offer a 0% introductory interest rate.

Pro tip: Check your credit report before applying for a consolidation loan, to make sure there are no errors dragging down your credit score. Also, depending on what shape your credit is in, it may make sense to wait a few months before applying for a loan while you take steps to raise your score in order to qualify for the best interest rates.

Visit Credible to apply for a debt consolidation loan and compare rates from multiple lenders.

9 OF THE BEST DEBT CONSOLIDATION COMPANIES

3. Get a balance transfer card

If you’ve racked up a lot of high-interest credit card debt, transferring the debt to a balance transfer card with a low interest rate may help you save hundreds of dollars in interest. Indeed, a number of balance transfer cards offer a low or even 0% introductory rate, usually for one to two years.

One thing to consider before applying for a balance transfer card: Some credit card companies charge high balance transfer fees and other charges, so visit Credible to compare card options and find the right balance transfer card for you.

PROS AND CONS OF BALANCE TRANSFER CREDIT CARDS

4. Use the debt snowball or debt avalanche methods

Generally, there are two strategies you can choose from when paying off debt.

  1. Debt snowball method
  2. Debt avalanche method

1.

Debt Snowball method: The debt snowball method entails paying off your debts in order from the smallest balance to the largest. The main benefit of this tactic is it helps you gain momentum (much rolling a snowball downhill).

2. Debt avalanche method: The debt avalanche method targets debts with the highest interest rates first.

This approach is the cheaper of the two, mathematically, since you’ll save more money in interest than you would with the snowball method, but it’s not for everyone.

You may not get the same confidence boost with the avalanche method that you get with the snowball method. You also don’t get the gratification of seeing the balance of one of your accounts go down quickly at the start of your debt payoff journey.

DEBT SNOWBALL METHOD VS. DEBT AVALANCHE METHOD: WHICH IS BETTER?

Источник: https://www.foxbusiness.com/money/ways-to-pay-off-debt

10 Steps and Strategies to Getting Debt in Less Than a Year – AARP Eve..

3 easy ways to get out of debt

iStockPhoto

Using your tax refund can help quickly erase your debt.

En español | When getting debt is a priority, there are several things you can do to eliminate that debt entirely — or at least pay off most of it — in 12 months or less.

Here are 10 tips and strategies to get you started on a debt-free life:

1. Bump up your debt repayment percentage

Putting at least 15 percent of your paycheck — or income from Social Security or pensions — toward credit card debt and loans will help you pay down those obligations much more quickly because most credit card companies only ask you to pay about 2 percent of the outstanding balance each month. Making small, minimum payments means that your debt balances are collecting interest as each month or each year goes by. Paying off large chunks of your debt within a few months could save you a significant amount of money on interest payments alone.

2. Use savings to pay down larger debts

Don't be afraid to use a portion of your savings to pay down high-interest rate debts. Using cash reserves for debt repayment is a smart decision because you will stop accruing interest on those large balances.

Although it may feel comforting to have some extra cash sitting in your bank account, the truth is that those funds aren't really working for you — not with today's record low interest rates. Don't deplete your savings entirely.

If you're sitting on a pile of cash, do use some of those funds to eliminate your bills.

Call your creditors to negotiate a lower interest rate. You'll be surprised how many creditors will be willing to reduce your interest rate your payment history and account standing.

If you have maintained a good relationship for a few years, you may be in a much better position to qualify for a lower interest rate. This can help you save some money on interest payments as you pay down that debt over the course of the year.

4. Use your tax refund check to pay down debt

While it's tempting to splurge on a high-ticket item or go on vacation with that tax refund check, a smarter money move would be to pay down some, or all, of your debt.

Consider the value of reducing your monthly payments with a single lump sum debt payoff strategy.

You'll enjoy the benefits of a lighter debt load over the entire year and for years to come, instead of enjoying the short-term satisfaction of a purchase.

5. Sell items for cash

Put together a list of items that you could sell on eBay, Craigslist, or at a garage sale. Drumming up some extra cash by selling items you no longer need or are ready to part with — and using the proceeds to pay down debt — can help you rapidly lighten your debt load.

6. Consider cashing in your life insurance

Cashing in your life insurance may be a viable debt payoff strategy because it will give you a chance to pay down larger amounts of debt quickly. If you feel you are drowning in debt and don't have beneficiaries that need to benefit from your life insurance policy — for example a spouse or children — then it might make sense to use those funds to pay off debt.

This strategy doesn't apply if you own a term life insurance policy. It only works for those with whole life policies that have built up cash value.

It's also important to note that even if you do have beneficiaries, you may be able to tap into part of the cash value of your whole life policy, getting cash for debt reduction and still leaving some life insurance proceeds to your loved ones.

If you're very determined to pay off that debt within the year, you should look for ways to increase your income and use that extra money to pay off debt as quickly as possible. Whether it's taking on a part-time job or negotiating a raise with your boss, think of some ways to start earning more money for at least a few months and make debt elimination a high priority.

8. Do a credit card balance transfer

Most of us typically tear up all those credit card balance transfers that arrive in our mailboxes. But if you want to go on a tear with your debt reduction efforts, a balance transfer can help.

By transferring high rate debt to a zero percent deal — one that lasts for 12 months or so — you eliminate all credit-card interest. That frees up cash flow, giving you additional money to knock out those credit card bills.

Just read the fine print before signing up to make sure you are really getting that low rate.

9. Use a statute of limitations law to eliminate old debt

Some people pay off old credit card debts — really old ones — even when they're no longer legally obligated to do so. We all want to repay our bills. But if times are especially tight and you just don't have the money, you should focus on current debts and consider forgoing repayment of old bills that are 7 to 10 years old, or even older.

Each state has its own set of rules regarding outstanding debts.

Some states don't allow a debt collector to collect a certain type of debt after a certain period of time; others limit the amount of time when a creditor can sue you over an old debt.

Either way, you should find out whether the statute of limitations has passed regarding an old debt you may owe. If it has passed, you can ly forgo repayment without worrying about financial, legal or credit consequences plaguing you.

For more information about dealing with old debts, contact your state Attorney General or the consumer protection agency for help and advice regarding your state's statute of limitations on credit card debt.

10. File bankruptcy to discharge your credit card debts

Bankruptcy should only be used as a last-ditch option to rid yourself of debt. But under extreme circumstances — as when you have no income or you have completely unmanageable credit card payments or medical bills — a Chapter 7 bankruptcy filing is appropriate to discharge credit card bills in their entirety.

If you feel morally obligated to repay your debts, you can also look into Chapter 13, which reduces some of your credit card bills. Then you repay the remaining debt over a three- to-five year period.

Lynnette Khalfani-Cox, The Money Coach(R), is a personal finance expert, television and radio personality, and regular contributor to AARP. You can follow her on and on .

AARP Money Map is a guide to manage unanticipated expenses

Источник: https://www.aarp.org/money/credit-loans-debt/info-07-2013/10-steps-to-becoming-debtfree-in-less-than-a-year.html

25 Ways to Get Debt

3 easy ways to get out of debt

Paying off debt can be frustrating and confusing if you don’t have the right plan. For more than 25 years, Dave Ramsey has taught people a step-by-step approach to slashing their debt called the 7 Baby Steps. 

On Baby Step 1, you save $1,000 in a starter emergency fund, and on Baby Step 2, you pay off all your debt (except the house) using a method called the debt snowball.

How to Pay Off Debt: The Debt Snowball Method

  • 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.
  • Repeat this method as you plow your way through debt.

     

Look, Baby Step 2 takes a few months to finish for some people and a few years for others. So if you’re on this step and laser focused on paying off that last debt, it’s possible the grind is starting to become . . . well, a grind. Maybe you’re exhausted and feel it’s going to take forever to become debt-free.

Hold that thought, because we’re here to give you our top 25 ways to get debt so you can be debt-free even sooner.

1. Start couponing.

You’ve probably heard this a thousand times—but are you doing it? You can save a ton of money just by showing a coupon to the cashier. Just be sure you’re using coupons for products you already buy, otherwise you could end up overspending on items you’ll never even use. That’s how you end up with 10 bottles of spicy mustard sitting in your pantry.

2. Try consignment shopping.

Kids grow clothes at the speed of light (or so it seems). And let’s be real: It’s not worth it to go into debt for your 2-year-old’s ever-changing wardrobe.

Check out your local consignment stores that sell pre-loved outfits in good condition. If you’d rather shop online, no problem. Sites thredUP and Swap.

com are great resources to get adult and children’s clothing at a fraction of the cost.

3. Cut the cable.

Welcome to this millennium, where you can watch most of your favorite shows online. If you haven’t cut the cord yet, do it! Put that $100 cable bill toward your debt each month and watch just how quickly your debt snowball starts rolling.

4. Stop going out to eat.

We get it. Going to a restaurant or hitting up the drive-thru is so much easier than making meals at home.

But while you’re enjoying the freedom of not having to cook for those picky eaters, you’re spending way more eating out than you would by eating in.

Want a creative way to socialize and share a meal? Invite friends over for taco night instead of meeting up at a restaurant. And hey—if you want to splurge for guac, we’re not judging.

5. Break up with your barista.

If you don’t know where all your money’s going each month, we’re pretty sure your favorite coffee shop can find it for you. Brewing your own coffee at home is a simple way to save money fast.

6. Visit the library.

Remember libraries? They have plenty of books and movies you can check out—for free! Your wallet has never loved movie night more than it does now.

7. Plan your grocery trips.

Make a list and stick to it! Use the calculator app on your phone while you browse the aisles to make sure you’re sticking to your budget. Do impulse items always end up in your cart? Try ordering your groceries online and then picking them up curbside at the store. Oh, and don’t ever shop on an empty stomach!

8. Avoid expensive hobbies.

Do you really have $200 a month to spend on golf? Are you serious? But it’s not just the golfers out there who need to rethink their club dues. Do you spend a ton at craft stores but never get around to starting your project? Home improvement stores can also cost you several Benjamins in one visit.

9. Ditch the gym membership.

You can still go for a run outside—for free. Gather some friends and start a running club. Or do those fancy HIIT workouts at your local park. Listen, it’s a free country. Well . . . mostly.

10. Find free entertainment.

Put a spending freeze on your entertainment costs for a little while. This means no going out to the movies, concerts, mini golf, bowling or whatever you do for fun that costs money. Instead, challenge yourself to find free ways to stay entertained. Take the kids to the park, go for a walk or a hike, enjoy a free concert, or look for a free event in your community.

11. Start a side gig.

Starting your own business has never been easier! Do you have a knack for making things? Sell your products online. Are you an animal lover? Take up dog walking or pet sitting.

Do you have a good eye and a nice camera? Start taking on clients for photo sessions.

Christy Wright’s Business Boutique is a great resource to show you how you can turn that hobby into a serious money-making machine!

12. Get a part-time job.

Not into starting your own business? Then consider becoming a driver for Lyft or Uber. A pizza delivery job at night could also bring in extra money.

You can even deliver other types of food in your spare time by working for places Uber Eats or Grubhub. Sure, you’ll have to put aside your pride and give up some nights and weekends of downtime.

But that’s a small sacrifice for extra cash in your pocket.

13. Sell the car!

The average monthly payment for a new car is $554.1 That’s just outrageous! Think about how much faster your debt snowball could move if you threw that $550 at it every single month.

14. Cut up your credit cards.

Shred ’em. Burn ’em. Shoot ’em. You’ll never get debt until you stop making debt a way of life.

15. Use the envelope system.

When you pay with cash, you actually feel your money leaving your hands. Ouch! Nobody s that. People tend to spend less when paying in cold, hard cash. With the envelope system, you'll see that cash going down so you can keep track of how much you’re spending.

16. Stop investing.

Yep, you read that right. And yes, we even mean stop contributing to your 401(k). Right now, you want all your income to go toward getting debt. Once you’re debt-free and have saved three to six months of expenses in an emergency fund, then you can resume your contributions. By then you’ll be on Baby Step 4 and can start putting 15% of your income toward retirement.

17. Ignore your broke friends.

Stop trying to keep up with the Joneses! Remember, you’re living no one else now so that later you can live and give no one else. In 20 years, you won’t have a financial worry in the world while everyone else will still have car loans, mortgages and credit card bills.

18. Make a budget!

Budgeting should be easy and—dare we say it—fun! Use our free budgeting app, EveryDollar, and focus your money on what matters: day-to-day spending, those pesky debts and wealth building.

19. Tell the kids you’re on a budget.

When it comes to money, the kids can be a worse guide than your stomach. Be open with them about what you do and don’t have room for in the budget. And remember: Never be afraid to use that magic word no.

20. Listen to The Dave Ramsey Show.

Listening to the show will encourage you when you feel you aren’t making progress. Every day, Dave helps millions of people across the country find hope and make a plan for their money. Their successes will inspire you to keep moving forward. 

21. Ask for a raise.

What do you have to lose? Michael Jordan always says, “You miss 100% of the shots you don’t take.” Thanks, Mike.

22. Learn to say no.

Make it a new part of your vocabulary. Love it. Embrace it. Because when it comes to spending money, you’ll be saying it quite often.

23. Sell items on Marketplace or Craigslist.

One person’s trash is another person’s treasure. Dig through your kids’ rooms and the abyss of your closet to find things you can part with to make some quick cash.

24. Give more.

Wait a minute—give? Yes! Giving changes you. It changes your spirit. Make giving a priority in your budget, no matter what your income is, and you’ll feel a million bucks.

25. Take control of your money with Financial Peace University.

Financial Peace University is the proven plan that will get you the cycle of living paycheck to paycheck. Financial Peace is the membership that will teach you how to pay off debt, budget, save big, and give no one else.

And right now, you can try it with a free trial of Ramsey+!  You’ll get all nine video lessons that break down the proven plan—the 7 Baby Steps, plus other awesome tools and resources to help you get your money on the right track right now!

How fast can you pay off your debt? Find out with the Debt Snowball Calculator.

But if you’ve already had the opportunity to go through the class, maybe it’s time to lead others through it. It’s one of the best ways to stay gazelle intense (and keep yourself accountable). Take it from us: Watching others change their lives feels pretty darn good.

There you have it—25 ways to get debt and breathe fresh air into your debt-free journey. Try a few of these tips and see if they work for you. When you hit a wall and feel you’ll never figure out how to get debt, just keep working the plan! Over time, your dedication will pay off!

Источник: https://www.daveramsey.com/blog/ways-to-get-out-of-debt

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