Want to know the secret to paying off debt extremely fast? Unfortunately, the ‘big secret’ is that there’s no easy fix. Unless you win the lottery or fall into a ton of money somehow that is.
In most normal cases, it takes hard work and lots of dedication and motivation to pay off debt.
Nevertheless, tons of people continue to pay off tens of thousands of dollars in debt in just a few months or years. How do they do it? It may be obvious, but they pay more than the minimum payment each month. Sometimes it’s double, triple or five times the minimum payment.
Your debt will not go away quickly if you just pay the minimum each month and you’ll end up paying more interest over time. In order to add more money to your debt payments, you’ll need to have more money.
Here are 5 real solutions to help you boost your minimum payments and pay down your debt super fast.
Refinance or Consolidate Your Loans
If your loans or credit card debt has a high interest rate that takes up most of your payment, you might want to look into getting your debt consolidated or refinanced. Consolidation will bundle up all your credit card debt or student loan debt into one loan with one low interest rate.
Refinancing is similar, although you will most likely keep the same loan terms. With either option, you’ll be potentially lowering your interest rate to something more reasonable so more of your money can go to the principle balance and not the interest.
Get a Second Job or Side Hustle
You can always get a second job or side hustle in your spare time to earn extra money to boost your debt payments. Calculate how much debt you have and what amount you’d reasonably like to put toward it each month. Then, determine a date in the future that you’d like to have all your debt paid off by to help motivate you to work extra.
For example, if you have $40,000 in debt and you want to pay it all off in 3 years, you will need to put around $1200 toward your debt per month or more in order to cover the interest. If you only have $700, currently, you’ll need to earn at least an extra $500 somehow.
You can look for an extra job in your neighborhood that has flexible hours so you can work two jobs temporarily. Or, you can start side hustling by freelancing your skills and talents, taking surveys online, starting a side business to sell a service, getting a work-from-home job, or anything you can think of that is legal and will help you earn money.
Sacrifice 5 Things
Your debt payoff journey will require some sacrifices. In an effort to boost your monthly payment, you can cut at least 5 things from your budget temporarily or permanently as you pay off your debt.
Think about non-necessity expenses that you can live without for a while. It may not be glamorous or fun at first, but the extra money you save by cutting your expenses can go toward debt.
You may even find out that you’ve been spending money on certain things that you don’t even need or want.
Obtain a Passive Stream of Income
Between working at your main job and side hustling, you probably won’t have much time leftover to earn an active income doing anything else. With an active income, you trade your time for money and work constantly to receive compensation. With active income, if you don’t work, you don’t get paid.
Passive income on the other hand, doesn’t require that you work all the time. Once you make the initial effort and work to create a product, service or establish investments, they will all start earning an income on their own without your direct involvement.
If you’re in debt, you may not be able to invest much to see a return, plus it takes time. However, you can create a resallable product or service for people or even become a direct sales consultant for your favorite products and build a team of independent contractors so you can gain commissions off their sales.
You can also start a blog and establish a strong web presence so you can an income through affiliate networks and advertising.
Paying off your debt is hard work. It’s even harder when you are striving to get rid of it ASAP, but it’s also a rewarding feeling to not have to owe anyone money and become debt free in just a few short months or years.
These proven strategies and solutions will help you crush your debt faster than you ever thought was possible.
Do you have debt? Now are you trying to pay it off?
Chonce is a freelance writer who’s obsessed with frugality and passionate about helping others increase their savings rate, eliminate debt, and work toward financial stability. She chronicles her journey to becoming debt-free on her blog, mydebtepiphany.com.
