When it comes to getting out of debt it does not happen overnight. It takes patience and discipline over even many years depending on the debt balance, and really has to become a way of life. Those that were spending machines in their early twenties have to really work towards responsible spending as they get older, but it will be completely worth it when you are not putting all of your monthly income in paying back outstanding debt. If you need help, try a few ways that can help you get out of debt and on the path to financial freedom.
Make a Lifestyle Change
The first step in getting out of debt is the most important, in that you cannot continue your spending beyond your means. If there is more money going out than coming in you are in bad shape for a financial disaster. Begin making sacrifices that will save money each month. A good place to start would be eating out, as the markup of food is outrageous. Stick to a regular pattern of grocery shopping and go out less frequently.
Pay More than the Minimum
By making only the minimum payment you will never get out of debt as a majority of the payment will go towards interest and little will go to principal, so you can make minimum payments month after month and see little progress getting the balance down. Some credit cards charge upwards of 16% APR, so depending on the balance could be charged hundreds in interest every month. Do your best to make the largest payment that you can afford in order to tackle that outstanding debt.
Create an Emergency Fund
Experts say that you should have three to six months of expenses set aside in an emergency fund an unexpected charge comes up such as a broken appliance, or even worse, an unfortunate job loss. If you have funds available to use in an emergency, then you do not have to put those charges on a credit card and sink deeper into debt with a balance that you will never be able to pay off.
Stick to a Budget
Now it is time to analyze every dollar going out and come up with allocated funds for the necessary monthly expenses such as food, gas, and bills. You should have funds set aside to contribute to a savings account, and hopefully at the end of the month you are at worst breaking even with the money coming in and going out. It is tough to have a successful budget, as most people fail at them, but make necessary tweaks as the months go by, and strive for success.
Generate Extra Income
Sure, you can get a side job waiting tables or work in retail, but there are also work from home jobs such as blog article writing can get generate extra income for you to put all towards climbing out of debt. Selling items, you no longer need on eBay and Craigslist are also great options for gaining extra cash.