Things No One Tells You About Paying Off Debt
If you are trying to achieve Financial Independence paying off all your debts should be one the top priorities. However paying off your debt sometimes can be one of the most difficult things if you don’t have a plan and most experts just tell you that you need to pay of your debts but not necessarily how to pay if off. So here I am today to talk about the things that no one tells you about when paying off your debts.
- Get Help – If you are really feeling overwhelmed by debt you can contact a Financial Counsellor. The sooner you get help the more options there will be available. You can also call your landlord/real estate to defer your rent until you have income available. Same with the bills. You can contact the service provider and explain your situation and they will explain your options. If you live in Australia you can call the National Debt Helpline – 1800 007 007 which is completely free.
- Prioritise your Debts – List all your debts and then put them in 2 categories. High priority (things you can’t do without) like your rent/mortgage, electricity, water and gas bills and Low Priority (things you could do without for at least a while) are like internet, phone bills, credit card and monthly subscriptions. Then identify the debts you can cut or reduce.
- Ask for Rate Reduction – From the low priority list check and see what you are paying for the debts. Like in the case of a credit card. What the interest rate is? Call the credit card company and request for the rates to be reduced. I have managed to do this not just with my credit card but also my home loans. If you have been an on-timer payer your bank or credit card company would want to retain your business.
- Change your Spending Habits – We all know why we got into debt in the first place and it’s all because of our spending habits and unless we change these habits we won’t ever be able to get out of debt. Instead of buying things you don’t really need why not sell the things you already had and don’t use on e-bay or garage sale? This will help you pay off your debts faster and earn you some extra money.
- Generate More Income – Look for ways to make more money. Get a second job or start a side hustle. There are numerous ways to earn extra income. Most people say that they don’t have time but these are the same people you will notice spend hours watching TV and shopping. Instead of spending time on social media why not use social media to make money.
Take charge of your money and so you control it instead of it controlling you.
