Ditch Debt for Good

February 2018

Debt and extra weight share a lot of similarities. Both can make us feel sluggish. Both debt and weight gain can be a major source of stress. This leads some people to take extreme measures, only to get frustrated and give up. Debt or weight creeps back.

Make 2018 your year to “ditch the debt,” and end the yo-yo effect for good. Here are a few ways to get started.

1. Start by taking inventory of the debt you have today. Review all accounts and note the debt attached to each one, as well as the interest rate you are paying. Assess the minimum monthly payment(s). You need to know what you’re working with, so calculate it all. Knowledge is power!
2. Create a plan. Are there some debts you can tackle quickly? Perhaps there are a few low-balance credit cards you can pay off immediately. A quick win means you have fewer accounts to track. Ideally, start with the debt that has the highest interest rate. Make more than the minimum payment to make a dent. Otherwise, you will be dragging out payments forever and sending your precious dollars to cover interest.
3. Try negotiating. Contact your various lenders and tell them you are on a quest to aggressively pay down your debt. Ask them if they can work with you. Might they consider lowering your interest rate? Have you been charged excess fees in the past that they might waive? The worst they can say is no, so ask.
4. Make a list of expenses you can cut. If you want pay off debt quickly, it helps to have extra dollars to allocate to the cause. Look at your non-essentials. Are their subscription services you can cut? Can you negotiate a lower cable/internet fee? Are you spending too much money on food, dry cleaning, lattes or shoes? Cut where you can, but don’t cut too deep. Just reel in the spending and when you start to see those statements drop, you’ll likely be motivated to pay off more.
5. Make more money. Yes, easier said than done, but not impossible. Take a second job. Turn a hobby or long-time passion into a money maker. Ask for a raise. Bold? Yes. But maybe 2018 is your year to make a little more. Are there things in your house you can sell? Baby clothes, unused household goods, holiday decorations. If you’re not using it, can you sell it and earn a few bucks? Every little bit counts. Any and all of these ideas might help pay down debt.

Debt can be a burden on the mind and pocketbook, but it can be tackled. The first step is usually the toughest, but it’s worth it. Celebrate your wins and once you get out of debt, ensure you have a budget and spending plan in place to avoid getting into heavy debt again.