Getting out of debt feels a lot like pushing a boulder up a mountain, no matter how much you scrimp and save, progress is slow and hard-won.
At times, it’s tempting to give up — but as hard as pushing forward is, backsliding into further debt is worse.
If you’re diligently making payments but feel like you’re not making progress on your debt, follow these tips to set yourself on the path to debt-free living.
Between credit cards, digital wallets, and subscription services, it’s easier than ever to spend money.
Yet nearly six in ten Americans don’t track their spending, and four in ten have never used a budget.
If budgeting sounds too stressful or pointless because you’re living paycheck to paycheck, consider that the majority of people who budget say it makes them feel more in control and confident, not less.
If you’re new to budgeting, skip the spreadsheet and use a budgeting app like Mint or YNAB.
Instead of relying on manual entries, these budgeting tools import and categorize banking transactions for you.
One word of warning to app users: Since these apps rely on data, checking your budget on the go could affect your phone bill.
While it’s possible to set the app to only sync over WiFi, it may be better to switch to an unlimited plan so you can review your budget as needed.
Depending on the carrier, it’s possible to find an unlimited plan for less than you’re spending for a no-contract phone.
For those of us overspending on coffees and entertainment, it’s simple enough finding places to cut back in order to put more money toward debt.
However, if yours is an income problem, not a spending problem, you might find yourself tempted to eliminate line items like your health and car insurance bills.
While skipping insurance might help you pay down debt faster, it also has the potential to saddle you with much more serious debt.
A trip to the ER averages nearly $2,000 before you even see a doctor, and major medical problems like cancer or a car accident can easily lead to six-figure medical bills.
If health insurance premiums are strangling your budget, see if you qualify for a subsidy or shop around for a cheaper plan instead of dropping it entirely.
The same goes for car insurance.
Driving uninsured not only leaves you responsible for paying property damage and medical bills out of pocket, it also puts you at risk of losing your license completely.
If that happens, you’ll be facing unemployment in addition to debt.
Older, paid-off cars offer cheaper insurance premiums, but no matter what you drive, it’s worth shopping around for a lower price if you’re struggling to afford insurance.
However, don’t just look at the quote. In addition to pricing, pay attention to a company’s reputation and history — State Farm and Geico, for example, are longstanding companies with A++ ratings — and whether they offer discounts like multi-policy, safe driver, and low mileage discounts.
What do you do when you’ve cut back on discretionary spending, found the best prices for life’s necessities, and are still barely making progress on your debt?
If there’s nowhere left to save and you’re still not reaching your financial goals, it’s time to look at increasing your income.
Finding a higher-paying job is always worthwhile, but it’s also time-consuming. Side hustles, on the other hand, are a fast way to increase your income.
Even if your community is too rural to make money on ride-sharing or other gigs, you can grow your income with a side hustle.
Pet and farm sitting, reselling antiques and appliances, and starting a cottage industry business are just a few of the ways you can earn extra money in a rural area.
If you have a steady internet connection, there are also lots of ways to make money online.
These tips won’t erase your debt overnight.
However, changes like these can be the difference between barely treading water with minimum payments or finally getting out from under your debt.
When you’re ready to finally be free of your debt, this is the place to start.
Image via Borevina
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