Being debt-free is within your reach, it could only be a few sacrifices away.
For many people, becoming debt-free may be an elusive goal. It would be great to reach a point where you’re not keeping track of multiple due dates.
Debt can stack up for multiple reasons beyond your control including unexpected medical bills or surprise home repairs. But, if you’re in debt because you’re living a lifestyle you can’t afford, you’ll have to make sacrifices. One way to get rid of your debt is to live below your means.
Getting rid of your debts is a choice entirely in your control
If you’re serious about being released from the shackles of debt, would you be willing to temporarily live without certain comforts or luxuries? Becoming debt-free is not impossible, it simply boils down to how badly you want it.
What are you willing to give up to get back in control?
Would you give up your possessions?
Could you manage without a television? Or a computer? Or the latest iPhone? Giving up your television not only gets you extra cash in hand, but it also means you won’t have to pay a cable bill each month.
You might want to keep your computer to stream free content in lieu of your TV. But, luxuries like the new iPhone aren’t necessities if you already have a working phone. You might even want to look at a cheap cell phone plan to save some extra cash.
Would you give up your house?
Would you be willing to live in a smaller house to conquer your outstanding debts? If you have enough equity in your house, you can consider putting it up for sale. If you’re struggling to meet your daily expenses, renting out your property or utilizing Airbnb might be a cost-effective way to pay the mortgage.
The following options might be worth giving thought to as well.
- Sell your house and rent it back from the buyer (this will save on moving charges).
- Keep your current house, rent it out and move to a smaller house.
Would you give up your vehicle?
A car comes with its own recurring expenses like gas, insurance and maintenance that you could pocket if you lived without one. Assuming that your car is in good shape, you could also consider selling it and using public transportation to get around. Consider the following before you sell:
- If you want to keep your car, you can drive for Uber or Lyft to make extra cash. Heard of Turo? You could rent your car for extra cash during the week with its service. You could even use Zipcar to rent a car when you need one.
- If you do want to sell, think about the area you live in and see if it’s realistic to use public transportation every week. Remember to factor in gas, insurance, maintenance and the like.
Would you give up your daily comforts?
Often when people live beyond their means, they make purchases that they don’t end up using.
- Some people purchase expensive memberships at the local gym. Give up your membership and stay fit by walking or jogging.
- Cut down on those cups of coffee you “can’t do without”. Buy coffee and keep it at work — you’d be surprised how much money you’ll save.
- Eat healthy, home-cooked food instead of eating out all the time. Similarly, take your lunch to work too.
- Are you paying higher insurance premiums for excessive coverage? Make sure your premiums are realistic and affordable.
These are all general tips, but if you look at your expenses you’ll see some places where you can really stand to save.
Would you give up your time?
After work, many people like to kick back and relax. What if instead, you took a part-time job to earn extra cash — perhaps in a shop you love or a bar your frequent.
Have you considered consolidating your debt?
Debt consolidation allows you to combine your existing debt into one single payment with one single lender. In addition to simplified payments, you could save money by getting a lower interest rate when you consolidate. It generally makes sense to consolidate your debts — it’ll make managing your finances a lot easier.