If you are drowning in debt, it’s time to take action. Debt can feel like a never-ending cycle with no way out. But there is hope! There are many ways to get rid of debt – some more challenging than others. Here you will find four quick methods for paying off your debts and breaking the cycle once and for all.
1) Make Most of Every Dollar
This may sound straightforward, but you need to start living below your means if you want to get out of debt. Evaluate your spending habits and find ways to reduce your expenses.
One way to make the most of every dollar is by creating a budget and sticking to it. When you know where every penny is going, you can be more mindful about what you purchase. We recommend the 50/30/20 rule, where you allocate 50% of your earned income on needs and expenses, 30% on essential wants, and 20% on savings and debt pay-off.
2) Find a Side-Hustle
Consider the skills you have, web coding, designing, or writing, and offer your services on a freelance basis. You can also look into dog walking, house cleaning, or tutoring. The possibilities are endless, and you can work as much or as little as you want.
It’s also essential to have an emergency fund saved up in unexpected expenses. Try to save at least three to six months’ worth of living expenses, so you’re not forced to rely on credit cards if something comes up.
If taking a second job sounds exhausting, then make it a short stint that helps you pay off your debt. Try to find a part-time job that will help you accumulate funds.
3) Consolidate your Debt
You can also consider a more aggressive approach and take advantage of debt consolidation with a loan or credit counseling service. This can help simplify your payments and save you money on interest charges over time. However, you should try this as the last option since it can negatively affect your credit score.
4) Don’t Underestimate the Power of Extra Payments
The best way to get out of debt is to make extra payments on your principal. This will help reduce the amount of interest you owe and shorten the time it takes to pay off your loan. You can do this manually or use a debt calculator to create a payment schedule that works for you.
If you’re feeling overwhelmed by your debt, don’t hesitate to reach out for help. Many reputable organizations offer free or low-cost counseling and debt management services in Chicago. Hughey Enterprises is also an excellent choice for those struggling with chronic debt. In addition to offering loans at easy, affordable rates, we provide our clients with quality debt counseling services. Apply now to get $50,000 in business credit.