Category: Debt payment

You found yourself stuck in debt for sound reasons.

To pay your medical bills, fix your broken-down car, or pay a down payment for your dream house. But the truth is, debt sucks.

So, you prefer getting out of it. You want to keep financial worries at bay. You want freedom in your life.

When your arm yourself with the three tips below, you’ll pay off debt fast. And it will boost your energy to achieve your bigger goals and live your dream life. 

1. Shift Your Mindset

According to James Allen, the author of As a Man Thinketh, your mind is like a garden. So it’s upon you to sow it with grander thoughts. Or allow it to run wild.

Here are some practical ways to shift your mindset and live a debt-free life:

• Ask yourself why you want to get out of debt. The reason for getting out of debt varies from person to person. For some, it’s to travel without feeling guilty about spending money. Others want to save money for retirement.

So, having a why gives you a sense of purpose. It motivates you during difficult times and keeps you focused on your debt repayment journey.

• Embrace a positive attitude. When in debt, you feel discouraged. Emotions like anger, worry, shame, and guilt linger in your mind. But to make financial progress, you need more space in your mind. Thus, a positive attitude propels you in the right direction. You focus on your small wins and remind yourself that you’re moving towards your goal.
• Become a minimalist. A minimalist focuses on the essentials and ignores the rest. So, you’ll cut down on luxury expenses like expensive suits and watches. The extra cash will go toward your debt repayment plan. But remember, becoming a minimalist does not mean you live a boring lifestyle. It means you want to spend your precious energy on things that add value to your life, like getting out of debt.

2. Pick and Stick with One Payment Plan

To make your debt repayment journey easier, you can use two ways. You can pick the snowball way or the avalanche strategy.

• The snowball method. Here is how this method works. You list your debts from smallest to largest. And you start with paying the small debt. You then roll the extra money on the next smallest debt. The process continues until you become debt free.
• The avalanche method. This is a different way to clear your debts. You start by paying off the debt with the highest interest rate. Once done, you move to the next debt with the highest interest rate until you pay the last debt.

If you want a psychological boost, then choose the snowball method. Why? Because knocking off the smallest debt motivates you to move on to the next.

The avalanche method is ideal for you if you are a number nerd. This is because you will reduce your interest rate over time. Thus, the total debt you pay will be lower.

3. Make More Money

And now, here is the sweetest part. What would be more satisfying than generating extra income to pay off your debts?

Here are some opportunities you should try. You will increase your income streams and manage to clear all your debts:

• Sell stuff like old books, clothes, gift cards, and furniture
• Teach English online
• Babysit for money
• Walk dogs for busy people
• Become a virtual assistant
• Become a social media manager
• Rent your car
• List an extra room on Airbnb
• Work as a freelancer on sites like Flexjobs, Upwork, and Freelancer.

Some of these opportunities will eat up huge chunks of your time. But it’s temporary. And it will be worth it when you become debt free.

Adopt the Death Ground Strategy

Do you see how simple it’s to pay off debt fast? With the three tips above, you’ll be ahead of the pack.

Use a tactic by Sun Tzu in his book, The Art of War, called the death ground strategy. Be like soldiers facing their fierce enemies. Behind them is an ocean. If they don’t fight back, they perish.

In the same manner, you must deal with your debt head-on. Be strong, and use your weapons or the three tips above to clear your debt. You’ll be able to do it because you’re stronger than you think.