The 5 Fastest Ways to Get Out of Debt—Ranked!
Did you know the average American is roughly $38,000 in debt? And that figure doesn’t include mortgages.
As you probably know, falling into debt is incredibly easy. We have been raised in a society that promotes immediate gratification. The result is learning to finance everything we want now rather than waiting until we can pay for it.
Unfortunately, getting out of debt takes time, dedication, and a solid strategy.
However, there are things you can do to speed up the process and we can help. Keep reading for the fastest ways to get out of debt.
1. Downsize Your Expenses
First, you need to create room in your budget to put more money each month toward your debt. There are two ways to do this. You can either earn more money or cut your expenses.
Let’s talk about reducing your monthly costs. You can take drastic measures like downsizing your house/apartment for the best and fastest way to get out of debt. You can also sell your newer car and get an older model that has much more affordable payments.
Other budget cuts include:
- Memberships and subscriptions
- TV and movie streaming services
- Dining out
- Getting coffee at coffee shops
- And more
Figure out your priorities and start cutting out extra costs to save hundreds each month that can go towards debt.
2. Earn More Money
Next, you should consider boosting your income. You can ask for a raise at work, take on more shifts, or find a part-time job.
However, you can also start a side gig on your own. Here are some options:
- Drive for Uber, Lyft, or Door Dash
- Mow yards
- Remove pet waste from yards
- Clean houses
- Find online gigs (freelance writing, social media management, etc.)
There are plenty of options out there to earn extra money.
3. Consolidate Your Debt
One of the fastest ways to get out of debt is by consolidating the debt you have under a single loan. Debt consolidation loans like those at bonsaifinance.com come with lower interest rates. They can be used to absolve your high-interest debts so you can pay less on interest.
Debt consolidation loan payments are often much less than what you were paying for the combined individual debts.
4. Use the Debt Snowball Strategy
Concerning payment strategies, the fastest easiest way to get out of debt is by using the debt snowball approach. Start by throwing ever extra dollar at the end of the month toward your smallest debt.
Once that debt is paid off, use the payment that was designated for it plus any extra money toward your next smallest debt. Continue the cycle, building up your monthly debt payment funds until all of your debts are paid off.
5. Stop Borrowing Money
Finally, recognize that the fastest way to get out of debt on your own is to stop using the money you don’t have. In other words, stop financing things, taking out loans, and using credit cards. Every time you borrow money, you accrue interest rates that take more out of your wallet.
Want More Tips on the Fastest Ways to Get Out of Debt?
If you’re looking for more advice on the fastest ways to get out of debt, be sure to check out some of our other articles before you go. Our blog is dedicated to helping everyday people and business owners alike manage their finances and improve their lives. Good luck!