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TOP 7 WAYS TO GET OUT OF DEBT

The average person accumulates over $400,000 in debts 10 years after college.

Being in debt can be a stressful experience. No matter what your circumstance is, if you signed for a loan, you are obligated to pay it back even if you have a life altering experience like losing a job, getting into an accident, or even if you have increased expenses due to having a child.

Many people try to get out of debt, but life slaps them in the face hard enough that they give up. That doesn’t have to be the case.

There are others, like myself, who are getting out of debt every single day, and not only that, but they are getting out of debt in a short period of time.

1.    Make a conscious decision to stop borrowing money
If you want to get out of debt fast, you have to stop using debt to fund your lifestyle. This means no more financing furniture, no more signing up for credit cards, no more test driving brand new cars that you don’t have the cash to pay for. This will help you focus solely on the debt that you currently do have so that you can develop a game plan to pay it off quickly.

2.    Establish a starter Emergency Fund of $1000
You might be wondering, ‘Why is having an emergency fund important’? Well, if you don’t have any money in the bank and an emergency does happen, how are you going to pay for it? For most people, credit cards become the funding source for those emergencies. If you are trying to get out of debt then you need to put a buffer between you and debt; that is exactly what an emergency fund does.

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3.    Create a realistic budget and stick to it
Developing a budget that tracks your income and your expenses is crucial to getting out of debt in a short period of time. It will help you gauge where you are with your finances so that you can move forward toward your goal. It will expose whether you have money left over, which is called a surplus, or if you are in the negative, which is called a deficit. The goal is to increase your surplus and use that money to pay down your debt. Below are two ways that you can do this.

4. Stop lending so much money to the IRS

The average household got a $3,034 tax refund last year. In other words, every month, an extra $253 was taken out of your paycheck and loaned to the IRS interest free!

Sure, you’ll get it back after you file your taxes, but don’t you need it now?

“I don’t want anybody to receive an income tax refund—that $250 a month can make a major, life-changing difference,” Cunningham says.

Rather than paying interest on your debt every month while the government gets your money, you should be funneling that cash toward your balance. On a $5,000 debt at 16%, adding $250 a month to a payment of $200 a month, you’d save $675 in interest and get your debt paid off in just over a year vs. two and a half.

You can put your money back in your pocket by adjusting your withholding on a W-4 tax form.

5. START PAYING OFF BALANCES FROM HIGHEST TO LOWEST APR

A Step-by-Step Guide to Getting Out of Debt

There are a few trains of thought when it comes to the actual debt repayment portion. The first being: Pay balances low to high. This is dumb, because it doesn’t take interest rates into consideration. The second, and more logical: Pay off the debt with the highest interest rate first, then work your way down.

Make the minimum payment possible for every account, besides the one that you’re trying to eliminate first. This allows you to focus on it, and to lose the least to interest. I’ve heard of people going to debt consolidation counselors, and also of people who transfer all of their balances to new credit cards that have 0% APR for an introductory period. While in theory these ideas could work for you, they aren’t the best ideas. Just imagine for a second: Why would anybody want to give you an unsecured loan to consolidate your debt? Or a 0% rate?

6. Spend Cash

Researchers have found that when people shop with credit cards and gift certificates, they are more likely to make impulse purchases on luxury items because they feel like they’re using “play” money. If that sounds like you, cut up the plastic.

And force yourself to feel the pain associated with spending real money by going on a cash-only diet.

“People who live on a cash basis typically save 20% over their previous spending, without feeling deprived,” Cunningham says. “It’s because using cash creates a heightened sense of awareness. You are more contemplative, and you realize you’re going to have to pay for things with hard-earned cash. Something clicks in that allows you to feel better about not buying the item.”

7. WORK, WORK, WORK

A Step-by-Step Guide to Getting Out of Debt

This one is going to blow your mind: To pay off debt faster you can work more. Overtime, second jobs, babysitting, or in my opinion is the most rewarding option is to start your own home based business.  Pretty obvious, right? More money, more debt repayment.

These above are not enjoyable but doable…If you lack the time or funds necessary to accomplish these and do not want to neglect your family while attempting to pay off your debts, I highly recommend you start your own home based business, part-time!

I have successfully launched my part-time home based business where I earn up to $5,825 per month (PART-TIME) while still working my full time sales gig!

To get more information on how you can get started today and create a nice, part-time income working from the comforts of your home, with hundreds of tax benefits….

WATCH THIS VIDEO BELOW!

PRESS PLAY AND TURN UP YOUR SPEAKERS!

 

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To get more information about how I am helping others create their own economy and can do the same for you now, CLICK THE GREEN BUTTON ABOVE!

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About Christopher Harold

I am an Online Marketing Coach, Consultant & Speaker who helps entrepreneurs who are struggling to sell their products and services online genreate more traffic, leads and sales and automate their business so that they can double their revenue while having a life. I'm married with 3 kids and love to travel as well as share my beliefs that God has created you to live an abundant life! I can help you! Thank you for reading my posts! If you would like to connect, reach out to me on Facebook.

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