Tips like thesehelped us pay off $127K in debt. You can read our story inSlaying the Debt Dragon: How One Family Conquered Their Money Monster and Found an Inspired Happily Ever After.
Welcome to 31 Debt Free Missions! A new feature this year on Queen of Free, during each day in January, I will provide 31 concrete missions or challenges for you to take on to #SlayDebt and take charge of your finances this year. Each mission will take you less than an hour (some will only require 15 minutes). Whereas, 31 Days to Kick Debt in the Teeth (which I’m reworking this year and reposting in January, too) focused on some of the philosophical changes you need to make in order to be successful with money, 31 Debt Free Missions are action steps to put into place after you have your thinking straight. Even better, during the month of January, I’m revisiting each of these challenges in order to sharpen my money saving and debt slaying skills.
Are you ready? Your mission is as follows:
True confession: I really don’t like talking on the phone. I love me some e-mail. I even like to text message. I’m cool (and maybe addicted) to social media. But when it comes to talking on the phone, I’m a big ‘ole cry baby. I may have even been known to force the King of Free to make some calls for me in the past. Maybe because I’ve grown into a more introverted state of being, maybe because it’s I’m lazy or fearful or feel just a little like calling someone is an annoyance to them (my problem, I know). However, today’s Debt Free Mission requires people like me to put on big kid pants and deal with their phone aversion. In less than an hour, make three phone calls to help both save money and give you the breathing space you need to put more energy toward Slaying the Debt Dragon. In no particular order, here are the three calls you need to make.
So even if you’ve closed the account already, you need to call your credit card company (or companies if you have more than one card). If you haven’t closed them you can do this at the same time. 😉 You need to see if you can get your interest rate reduced at all. You may or may not be able to achieve this, but it never hurts to ask. The King of Free is found of saying, “If it ain’t in writing, it didn’t happen.” So be sure that if you do get your rate reduced, then be sure to ask for the company to send you a written confirmation (paper and e-mail if at all possible) that your rate has been altered.Some credit card companies will write off your debt if you can offer a large lump sum of cash. Have all of the cash in hand and a set firm number in mind if this is a route you want to take. We paid off all of ours instead of settling, but if your company is willing to work out an agreement this could be a path for you to take. Whatever you feel most comfortable with in the long run is important.
Whatever her name – around here she was the now deceased Sallie Mae (RIP just kidding, die you ugly, menacing beast) – you need to call you student loan lender and ask a couple of questions. 1) Are there anyways to decrease your interest rate? 2) Is there an advantage to setting the loan to autopay? The King of Free is the expert when it comes to other questions that you can ask about student loans as well as best practices for kicking them in the teeth. Also he is hilarious while he explains inwhoopin and whompin student loans.
If you have a large load of medical debt, you might be able to renegotiate it. Every service provider and billing department is different but you might be able to pay only a portion of the debt if you have a large lump sum of cash to offer. If you don’t have cash, then you might be able to set up a no interest payment plan in order to break up the sum and not pay it all at once.
What other calls would you suggest to make to reduce your interest rates or discover special offers to give you the momentum you need to pay off debt?
My book is now available:Slaying the Debt Dragon: How One Family Conquered Their Money Monster and Found an Inspired Happily Ever After.You can also check outInspiration to Pay Off Debt: 30 Days of Encouragement from the Queen of Free
on Kindle.
This post contains an affiliate link. That means when you get a great deal or maybe even something for free, you also help our family pay off our mortgage early. And for that, we royally thank you!
Related posts:
Throwback Thursday: How to Pay Off Debt $0.19 at a TimeYou Don’t Have to Be Miserable to Pay Off Debt31 Debt Free Missions: Reorganize Your Pantry
FAQs
Being debt-free is a financial milestone we often hear about people striving for. Without debt, you can focus on building more savings, investing those extra funds and just simply having more peace of mind about your finances.
What does it mean to be debt free? ›
Living debt-free means having no outstanding payments or financial obligations on credit cards, personal loans, student loans, auto loans, medical bills, mortgages, utility payments or other types of debts. Some people still have a mortgage but consider themselves debt-free if all other accounts are paid off.
What percentage of Americans live debt free? ›
The study found that six in 10 people could not cover three-plus months of expenses. Thirty-one percent said they had no emergency fund. It's no wonder just 23% of Americans say they live debt free, according to the Federal Reserve.
Are you rich if you are debt free? ›
Myth 1: Being debt-free means being rich.
A common misconception is equating a lack of debt with wealth. Having debt simply means that you owe money to creditors. Being debt-free often indicates sound financial management, not necessarily an overflowing bank account.
At what age should you be debt free? ›
Carrying the burden of debt is the way of life for many. According to Experian, as of the third quarter of 2023, the average American held $104,215 in debt. You're probably very familiar with the negative side effects of debt and how hard paying it down can be, but do you know that by age 45, you should be debt free?
Is it better to be debt free or have cash? ›
Tara Alderete, director of enterprise learning at Money Management International, says it usually makes sense to prioritize debt reduction overall, but there are exceptions. “If you already have adequate savings in your emergency fund, you may want to focus on quickly eliminating debt,” Alderete says.
What does the Bible say about debt? ›
Luke 7:42-43 - He who is forgiven much (debt) loves much; he who is forgiven little (debt) loves little. Romans 4:4 - Wages, like a debt owed, must be paid.
What are the disadvantages of being debt free? ›
Cons of Living Debt-Free
Without open accounts, there may not be enough credit activity for credit bureaus to calculate your score, which could harm your credit. Of course, that's not a problem if you don't want to play the credit game and have enough cash to take care of your financial needs.
How to pay off debt with no money? ›
How to get out of debt when you have no money
- Step 1: Stop taking on new debt. ...
- Step 2: Determine how much you owe. ...
- Step 3: Create a budget. ...
- Step 4: Pay off the smallest debts first. ...
- Step 5: Start tackling larger debts. ...
- Step 6: Look for ways to earn extra money. ...
- Step 7: Boost your credit scores.
If you have $20,000 in credit card debt that you need to pay off in three years or less, you have multiple options to consider, including:
- Take advantage of a debt relief service.
- Consolidate your debt with a home equity loan.
- Take advantage of 0% balance transfer credit cards.
Option Two: File a Chapter 7 bankruptcy. The “upside” of proceeding in this fashion is that your Chapter 7 Trustee will not be able to reach your assets either, and the stress associated with harassing phone calls and other collection activities will stop immediately upon the filing of your bankruptcy petition.
How many people live paycheck to paycheck? ›
How Many Americans are Living Paycheck to Paycheck? Recent MarketWatch Guides survey results indicate that 66.2% of Americans feel like they're living paycheck to paycheck. Respondents struggling to make ends meet span demographics, including genders, generations and incomes.
What is an average credit score? ›
Credit scores help lenders decide whether to grant you credit. The average credit score in the United States is 705, based on VantageScore® data from March 2024.
How many people have no savings? ›
Many, it turns out, are not. A new Empower study reveals more than 1 in 5 (21%) Americans have no emergency savings — money set aside for unexpected financial events such as job loss, home and car repairs, and medical bills. Nearly 2 in 5 (37%) couldn't afford an emergency expense over $400.
Is it better to be debt-free or have cash? ›
Tara Alderete, director of enterprise learning at Money Management International, says it usually makes sense to prioritize debt reduction overall, but there are exceptions. “If you already have adequate savings in your emergency fund, you may want to focus on quickly eliminating debt,” Alderete says.
What are the disadvantages of being debt-free? ›
Cons of Living Debt-Free
Without open accounts, there may not be enough credit activity for credit bureaus to calculate your score, which could harm your credit. Of course, that's not a problem if you don't want to play the credit game and have enough cash to take care of your financial needs.
Is there a downside to paying off debt? ›
Less discretionary spending money
Whether you're paying off a loan with a lump sum or you plan to chip away at it with larger payments, paying off your loan faster will likely mean tightening up your budget.
Is it good to avoid debt? ›
Avoiding debt is one of the best ways to prepare for a secure financial future. Many consumers, though, risk financial freedom by falling into credit card debt. If used properly, a credit card offers many advantages, such as : Protecting purchases.
on Kindle.