Top Strategies for Eliminating or Reducing Your Debt

Getting into debt is relatively easy, but getting out of it isn’t. It’s becoming increasingly difficult to pay off debt on top of keeping up with monthly bills. So much so that a lot of people can’t even afford to set aside money for the future. Although it might be tough, it’s not entirely impossible to eliminate or reduce your debt. There are plenty of ways to pay off your debt. Here are some useful strategies to consider to get yourself out of debt faster:

File for bankruptcy

Filing for Chapter 7 bankruptcycan eliminate most types of debt, such as personal loans, medical bills, cell phone bills, credit cards, and lawsuits. You won’t be obligated to pay off these debts when the bankruptcy file is charged, but you need to meet a particular set of requirements to receive a bankruptcy discharge. Take note that certain types of debt can’t be eliminated just by filing for bankruptcy, including child support and alimony, student loans, government penalties, and specific housing fees.

Engage in a side hustle

Earning money from a side job can help you tackle your debt much quicker. Make a list of the skills and talents you have that you might be able to monetize. This could include things like freelance copywriting, babysitting, landscaping, house cleaning, selling crafts, or becoming someone’s virtual assistants. There are plenty of sites where you can advertise your services. You can also set up garage sales and sell your old belongings to come up with more cash. All this extra income can be used to pay off your loans quickly.

Discuss the terms of your payment plan

Man working at the office

If you take the time to negotiate your payment plan with your creditor, it’s possible that you might be able to waive late fees, lower your monthly payments, or defer payment. Be polite and strategic when discussing your options and offer up realistic suggestions. For example, if your minimum payment is $250, you might be able to slash off $50 off of it instead. It’s not much, but it’s still money that can be saved.

Inquire about lower interest rates on your credit cards

If your credit card interest rates are so high that it makes paying your debt impossible, consider calling your credit card company to negotiate for lower interest rates. This is quite a common occurrence, but most people never think to ask. If you’ve proven yourself to be reliable when it comes to making payments, you stand a better chance of getting approved for a lower interest rate.

Stick to a strict budget

Cut out all unnecessary expenditures and build a bare-bones budgetthat you should stick to. Easy money suckers to get rid of include food delivery services, cable television, and monthly subscriptions. What you’ll save from getting rid of these should go directly to paying off your debt. Sticking to a strict budget is only temporary, especially if you give your all when trying to pay off what you owe. Once you’ve gotten yourself out of debt, or at least close to it, you can add back discretionary spending into your budget.

The reality of being debt-free is more attainable than you think. There are plenty of ways to get out of it if you’re committed to paying off what you owe.

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