I get emails all the time from readers asking on quick tips on getting out of debt, so I figured I would put together a list of a few things I can recommend. However, keep in mind that while getting into debt is very easy, getting out of it is not. It takes work and effort, but the payoff is enormous. To jump start your efforts, try these 10 quick tips to start reducing your debt!
1. Stop using credit cards. Seriously. Put them away, freeze them in blocks of ice, hide them from yourself. Continuing to use credit cards when you are in debt is a recipe for disaster!
2. Call your credit card companies and ask them for interest rate reductions. I wrote my the Digging out of Credit Card Debt Challenge before and included a script to use when calling them. Do not yell or get mad if they say no; just call the next credit card company in your wallet.
3. If you work for an understanding company and are comfortable doing so, ask for an advance on your salary. I only say this because I did it once, and they were more than happy to give it to me. I paid off debt, and then had them take a little amount out of each paycheck until it was paid back. That way, I didn’t pay any interest at all to the credit card!
4. Check your deductible levels on your home, car, life, and health insurance. If you are healthy, setting those deductibles higher could save you hundreds a month. Same could go for the other types of insurance as well.
5. Be sure to compare deals and offers on things like cable, cell phone and internet service – you don’t want to have to pay more than you should. Especially with things like cable, as one call can lower your rate for at least 6 months. Go ahead, try it – give them a call and tell them you are thinking about getting rid of cable because of the expense. I almost guarantee they will offer you a promo price.
6. When you need them, stop paying for things you can get for free. There is free open-source software available called Open Office that replaces Microsoft Office, for example. For Windows users, check out Open Source Windows. For Mac users, check out Open Source Mac.
7. If you own your own home, have the electric or gas company come in and do a home energy audit. These are normally free, and they will be able to tell you where and how you are losing money by not being efficient.
8. Check your withholding amounts on your paycheck. Did you get a refund this year? That means you overpaid, and you could have had that extra money in every paycheck. Check with your accounting department at work on this one. Then, send the extra money to your credit card.
9. Make snowflaking payments to your credit card company. A few dollars a day paid every day to your debt can make a huge difference.
10. Finally, keep some money for yourself. If all you do is throw every penny at your debt while excluding doing anything at all for yourself, you will end up binging at some point. People who diet to the extreme almost always end up sitting on a couch with a bucket of ice cream at some point – they went for too much too quickly. Don’t let that be you!
Do you have any other quick tips to help those fighting the debt battle?