7 Tactics That Make Digging Yourself Out Of Debt Super Easy (2024)

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7 Tactics That Make Digging Yourself Out Of Debt Super Easy (1)

A few years ago I would have thought nothing about dropping money on an expensive night out or a new wardrobe – at least not until the bill arrived. I knew I was in trouble, but ignoring the problem seemed easier than trying to fix it. Eventually, though, debt problems catch up with you.

When I found myself falling behind on my house payment, panic gripped me and I knew it was time to make some changes. These seven tactics helped me conquer my debt for good.

#1: Make the Tough Calls


The first step was the hardest to take. I don't like confrontation, so my heart was beating a million miles a minute when I started dialing my creditor's phone number.

In retrospect, I should have done so sooner.

Your creditors don't want you to default. With the first phone call, I was able to secure a lower interest rate and minimum payment. This gave me the courage to continue.

By the end of the afternoon, I had managed to get my payments lower by securing an easy debt consolidation loan.

It's much easier to keep track of one payment than several. Plus it gave me a better idea of where I stood financially.

Digging yourself out of debt might take some work but be easier than you think. Learn how to free up a lot more money for debt repayment!Click To Tweet

#2: Trim the Car Fluff

My next series of calls was to get quotes on my car insurance.

The premium renewal was coming up, so this was an opportune time to save some cash. Once I was armed with a lower quote, I called my current provider.

I was prepared to switch companies, but I was able to negotiate a lower rate. I was surprised to find I was covered for things I didn't need.

Why would I need rental car insurance when I have a second car at my disposal?

I also called and got info on fighting that speeding ticket that I had gotten. I fought the ticket and won without even having to go down to court!

Had I paid that ticket, the points would have raised my premium significantly and I would have had to contact a specialist car insurance brokerto get a decent rate.

#3: Put in More Than the Minimum


Paying just the minimum balance is a surefire way to stay in debt for many, many years. People handle payoff differently – some prefer to wipe out the smallest debt.

I went for the one with the highest interest rate. I paid just the minimum on everything else, focusing higher payments on just that one debt.

Once it was taken care of, I repeated the process on the next one. It was satisfying to see the numbers dropping each month!

#4: Cook at Home

It's crazy how much of my budget was going to food. First, I started cutting back on the lunches and dinners out, but soon I was ready for a bigger challenge.

I took the time to prepare work lunches at home, assembly-line style, every Sunday evening. I made dinner menu plans, choosing quick, easier to prepare foods. Soon it was second nature.

On the few instances when I just couldn't bring myself to cook, I'd stop by the grocery store deli and pick up an oversized sub sandwich or bag of chicken – still expensive, but at a fraction of the cost of the fast-food alternatives.

#5: Downsize Your Car Loan

Remember that second car? It finally hit me how silly it was to have an overpriced car loan on a vehicle we rarely drove – especially on a gas-guzzling SUV in the city.

I did the research and sold it online with CarBrain, using the profits to purchase an older model, fuel-efficient car with the profits. That freed up a lot more money for debt repayment.

#6: Ignore the Windfalls


Tracking my money soon gave me insight into how many windfalls and bonuses had been slipping through my fingers.

I made it a habit to instantly tuck away every bit of extra cash, whether it was a $20 rebate check or an annual bonus, instead of spending it.

I treated raises the same way – I didn't allow lifestyle creep to increase my rate of debt or spending.

This money helped me get out of debt more quickly. Now that I'm debt-free, all the bonuses are adding to my retirement fund and savings balances.

#7: Reward Yourself

As humans, we crave acknowledgment. Don't fall into the trap of rewarding debt repayment with new debt or expensive “prizes,” though.

I set incentives throughout the process, but I kept them free.

For example, when I paid off the first credit card, I took a paid personal day to go hiking in a nearby area I had been longing to visit.

Delayed gratification made the reward all the sweeter. Good luck!

How do you keep your debt in check?

Related Posts:

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  • Is it Time to Fix Your Home Loan for Your Family?
  • Budget Tips for Your First Home Purchase
  • Getting Your First Mortgage With Student Loan Debt
  • Four Reasons to Build a New House
  • Meal Planning for Dummies
  • Money Goals You Should Reach By 30

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7 Tactics That Make Digging Yourself Out Of Debt Super Easy (2024)

FAQs

How to get out of debt 7 tips that work? ›

7 steps to more effectively manage and reduce your debt
  1. Take account of your accounts. ...
  2. Check your credit report. ...
  3. Look for opportunities to consolidate. ...
  4. Be honest about your spending. ...
  5. Determine how much you have to pay. ...
  6. Figure out how much extra you can budget. ...
  7. Determine your debt-reduction strategy.

How do I get myself out of extreme debt? ›

7 tips to help dig your way out of debt
  1. Re-examine spending habits.
  2. Determine the right payoff approach for your situation.
  3. Go beyond the minimum.
  4. Earmark extras to the balances.
  5. Consider debt consolidation methods.
  6. Embark on a debt management plan.
  7. Settle for less than what you owe.
  8. FAQs.
Aug 9, 2024

What is a trick people use to pay off debt? ›

Pay off your most expensive loan first.

Then, continue paying down debts with the next highest interest rates to save on your overall cost. This is sometimes referred to as the “avalanche method” of paying down debt.

How do I get out of debt quickly on my own? ›

Here are strategies and tips for getting out of debt faster.
  1. Add Up All Your Debt. ...
  2. Adjust Your Budget. ...
  3. Use a Debt Repayment Strategy. ...
  4. Look for Additional Income. ...
  5. Consider Credit Counseling. ...
  6. Consider Consolidating Your Debt. ...
  7. Don't Forget About Debt in Collections. ...
  8. Stay Accountable.

What is the 7 7 7 rule for debt collection? ›

Consumers are well-protected when it comes to debt collection. One of the most rigorous rules in their favor is the 7-in-7 rule. This rule states that a creditor must not contact the person who owes them money more than seven times within a 7-day period.

How to pay off $5000 in debt in 6 months? ›

If you can afford to pay off your debt during the promotional APR period, a balance transfer card may be your best bet. For example, with $5,000 of debt, a six-month intro APR balance transfer card would allow you to pay off your debt interest-free with $833.33/month payments.

How to pay off debt with no money? ›

How to get out of debt on a low income
  1. Sign up for a debt relief program.
  2. Cut expenses to free up extra cash.
  3. Take advantage of opportunities to earn more money.
  4. Use financial windfalls to your advantage.
May 22, 2024

How to get out of $20,000 debt fast? ›

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:
  1. Take advantage of a debt relief service.
  2. Consolidate your debt with a home equity loan.
  3. Take advantage of 0% balance transfer credit cards.
May 22, 2024

What is the snowball method of debt? ›

The "snowball method," simply put, means paying off the smallest of all your loans as quickly as possible. Once that debt is paid, you take the money you were putting toward that payment and roll it onto the next-smallest debt owed. Ideally, this process would continue until all accounts are paid off.

How do I wipe off my debt? ›

Which debt solutions write off debts?
  1. Bankruptcy: Writes off unsecured debts if you cannot repay them. Any assets like a house or car may be sold.
  2. Debt relief order (DRO): Writes off debts if you have a relatively low level of debt. Must also have few assets.
  3. Individual voluntary arrangement (IVA): A formal agreement.

How to get out of debt for dummies? ›

Tips for managing your debt repayment plan
  1. Check your budget/spending plan to know the amount you can pay toward each debt. ...
  2. Make a list of debts you want to negotiate. ...
  3. Know your rights. ...
  4. Call your creditor or collector. ...
  5. Make sure you get any concessions or settlement agreements in writing. ...
  6. Stick to the repayment plan.
Apr 12, 2024

How to come out of debt trap? ›

To escape a debt trap, focus on budgeting, prioritize debt payments, consider consolidation or negotiation, and avoid accruing more debt through responsible financial management.

What are the three biggest strategies for paying down debt? ›

Three big strategies for paying down debt are the snowball method, the avalanche method and debt consolidation. Let's take a closer look at how each of these strategies works, so you can figure out which one makes the most sense for you.

How to get out of $10,000 debt fast? ›

7 ways to pay off $10,000 in credit card debt
  1. Opt for debt relief. One powerful approach to managing and reducing your credit card debt is with the help of debt relief companies. ...
  2. Use the snowball or avalanche method. ...
  3. Find ways to increase your income. ...
  4. Cut unnecessary expenses. ...
  5. Seek credit counseling. ...
  6. Use financial windfalls.
Feb 15, 2024

How can I get out of $20000 debt fast? ›

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:
  1. Take advantage of a debt relief service.
  2. Consolidate your debt with a home equity loan.
  3. Take advantage of 0% balance transfer credit cards.
May 22, 2024

What is the number one way to get out of debt? ›

List your debts from highest interest rate to lowest interest rate. Make minimum payments on each debt, except the one with the highest interest rate. Use all extra money to pay off the debt with the highest interest rate. Repeat process after paying off each debt with the highest interest rate.

How can I get out of debt legally? ›

Debt settlement programs are typically offered by for-profit companies to people with significant credit card debt. The companies negotiate with your creditors to let you pay a “settlement,” or lump sum of money that's less than what you owe. They agree that this amount will settle your debt.

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