Learn the correct steps to help get yourself out of debt and develop a healthy financial well-being.
Many of our members want to know how they can reduce their debt quickly, as it can happen to any of us. Unfortunately, accruing the debt is usually the quick part. Paying it all back (plus interest) takes a bit longer. Still, there are ways to speed up the pace of debt payback and being able to see that number go down quickly each month is a great motivator!
Here are five quick tips on reducing debt to kick start your journey to becoming debt-free:
Tip #1: Cut out unnecessary expenses
Most people assume they don’t have unnecessary expenses. And it’s possible you don’t. Still, this step is really all about taking an honest look at where you put your money. In fact, this step alone should alter the way you shop and spend. For example, you might find that you’re spending a lot of money eating out and still spending hundreds at the grocery store. Or maybe your spending too much on monthly streaming services, but no one in your house is using them. A great way to see where all your money is going is by tracking it with Online Banking and reviewing your statements to follow that dollar! Learn how to enroll in eStatements for quick and easy access to your account history.
Tip #2: Create a budget
This is one of the most important tips to becoming debt-free. Just remember that budget-living doesn’t have to mean pasta for dinner every night. You can cater your budget to what you’re comfortable with. It all starts with taking the first step and setting sustainable monthly limits on things like groceries, toiletries, clothing, and going out. If you’re spending more than you’re making, it’s time to reevaluate your budget. Don’t know where to start? Check out our article on How to Create a Budget or learn about our free Savings Goal Tool.
Tip #3: Be creative with your hobbies and activities
Hobbies and activities are good to have, but while you’re paying off debt, consider getting some cheaper ones. Love going to the casino? Start a card night with friends and play for quarters. Enjoy going to the movies? Rent a movie instead, dim the lights, and make popcorn at home. Try opting for some new interests that could contribute to helping reach your goals like coupon-cutting, teaching your kids how to cook at home, or if you have the time maybe picking up a part-time job.
Tip #4: Try a balance transfer on your Credit Cards
Balance transfers move debt from a high interest credit card and transfer it to a lower interest rate card. This means you’ll pay less on top of the amount of debt owed. At Alltru we can help find the right credit card for you. In fact, you can receive an introductory rate as low as 3.99% APR on all balance transfers. Alltru Visa Credit Cards have no annual fees, no balance transfer fees, 24/7-member service, and zero liability fraud protection. It’s a win-win and a for sure way to save some money while paying off your debt. Check out our credit card options here.
Tip #5: Start selling – One man’s trash is another man’s treasure.
If you’re not using something like a large appliance, workout equipment, clothing, or a piece of technology, try selling it. A good rule-of-thumb to follow is if you haven’t used it in over a year, then you probably don’t need it. Online sites like Facebook Marketplace, Poshmark, and Craigslist can help you sell things in your local area or even to others across the country for little to no extra cost.
Paying off debt may require you to make a few lifestyle changes, but it doesn’t have to be disheartening. If you have a difficult time adjusting to new circumstances, implement gradual changes so the process won’t become too overwhelming. This is a work at your own pace process so take it one step at a time.