Becoming debt-free does not happen overnight. You cannot expect a miracle to happen and wake up without debt the next morning. So if you have outstanding debt, which has been stressing you for quite a while, learn of the top tips on how to be debt free and regain financial freedom sooner.
Effective Ways on How to Be Debt-Free
Pay debt on time
Don’t miss on your monthly payments. Pay on time so that you can avoid paying late fees and higher interest rates. Now if you want to pay that card with the highest interest rate, you have to put more money on it monthly, while paying a minimum for the other cards.
Find ways to earn income
There are ways to make money from home, including selling your knowledge, such as working as a freelance financial coach, writer, editor or teacher. You can also be paid for your opinion by filling up surveys or testing products.
List down your debts from largest to smallest
While it may be stressful to look into those monthly bills, you should know where you’re standing by taking all the bills and listing the debts according to interest rate. You may want to consider paying the one with the highest interest rate before the rest.
Set-up an emergency fund
Emergencies happen least expectedly. You must be prepared by having an emergency fund, where to put some of your money so that you’ll be ready when any catastrophic event in your life happens. For a start, you may want to keep $1000 into that emergency savings account for medical bills, car repair and other unexpected bills and expenses.
Create a budget plan
Having a budget is a simple technique that most people fail to do. By having a solid plan, you will know exactly where your money is going. Look into your expenses, including credit card and bank statements. You can also use Excel spreadsheet for tracking your expenses.
Here, you can input categories for every type of expense and set a limit for each. You must see to it that your budget isn’t going beyond what you’re earning. Consider looking into your previous month’s expenses and determine those you want from needs. This is one of the best ways on how to be debt free to consider.
Make paying off debt fun – think of it as a season of working on becoming debt-free. It simply means that this season of paying off your debts will eventually come to an end and you need it regain financial freedom. But when you hit each milestone, you should treat yourself. You can watch a movie or have coffee.
De-clutter and sell the items you don’t need
Clean up your closet space and pick those items you don’t need. You may also consider looking around your house and finding items that you can sell and earn money from in places like eBay and Amazon. By selling unwanted items, you can make some money for paying off debt, eventually decreasing your financial burden.
These simple strategies can help you become debt-free sooner than you think you’d be. Create a sound budget plan and stick to it, sell some items you don’t need and set-up an emergency fund, to name a few, and experience financial freedom faster. If you need more advice and tips on how to be debt free, feel free getting in touch with the DSC Consolidation team today!