I‘m convinced that there is only one surefire way to undo your debts. No, it’s not with a debt consolidation company. We’ve paid off our debt without negotiating for lower payments, lower amounts owed, or fighting with collectors.
Some may say we had it easy. Sure, it wasn’t the most difficult situation. But that doesn’t mean undoing our debts was an easy task. Here are some things that worked for us as we fought our way to freedom from non-mortgage debt.
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Step 1: Cut Expenses Wherever You Can
This isn’t going to be pretty. If you want to get rid of your debt in a hurry, think of things you are paying for that you really don’t need in your life anymore. For example, do you have cable TV? It’s time to get rid of it. Visiting Starbucks every day on your morning commute to work? Well, I think it’s time to make some coffee at home (or for you brave ones, try drinking water instead)!
Remember, this is how to undo your debts the hard way. Anywhere worth going is worth the extra effort, and paying off debt is no different.
Step 2: Get A Second Job, Or Third Job!
Once you’ve cut your expenses the most you can, it’s time to start thinking about getting another job:
- Deliver pizzas.
- Clean houses.
- Mow lawns.
Step 3: List Your Debts Using The Debt Snowball Technique
This is where you list your debts smallest to largest in amount and pay them off in that order. Now, that may seem like the unsophisticated way to pay off your debts – everyone knows that paying off your higher interest debts first saves you the most money – but you need quick wins in order to stay motivated. As you pay off the smaller debts, you’ll be empowered to pay off the larger ones. In the end, you’ll pay off your debts quicker and with greater intensity.
Dave Ramsey is the main proponent of the debt snowball technique. I highly encourage you to read more about his plan to help you eliminate your debt.
Step 4: Rinse And Repeat!
The rich rule over the poor, and the borrower is slave to the lender. – Proverbs 22:7
This is very practical and doable. The only way you will not be able to erase your debt is if you are not serious about it. Your tip to “revisit” these steps every now and then is important to the successful implementation of the steps. The first thing I did to cut expenses was to cut my cable TV. For 3 years, we didn’t have one and just contended ourselves with the regular free TV channels. It paid off. Thank you for the encouragement. God bless you more!
Here are some more tips make your dollar stretch. Buy used cars, shop goodwill, learn to haggle, pay cash for a better deal, two alcohol drinks only when you go out set limits, dine with coupons only, do your own landscaping or remodeling, scrap for extra cash, do online surveys for cash, by scratch and dent appliances or returned ones, when remodeling buy the mistint paints if the color is close to what you want, repurpose when possible. Never pay full price for anything material that God didn’t make.