In the United States, we are sited on top of a mountain of debt. On a federal level, the national debt has hit more than $22 trillion. On an individual level, we have debt worth more than $13 trillion. College graduates have more than $1.2 trillion and companies have more than $70 trillion in debt. As individuals, we are among the most indebted people in the world. Therefore, having a good strategy to pay off your debt faster is a great thing. In this article, we will look at a few ways you can use to pay off debt faster.
Pay Off Debt Faster: Get a Side Hustle
A side hustle is the most important method you can use to pay off debt faster. A side hustle is simply a strategy where you use your free time to make extra money. Fortunately, we are living in an age where there are so many side hustle strategies. Some of the most common side gigs that you can use to make extra money are:
- You can drive for Uber and Lyft.
- You can lease your spare room using AirB&B or HomeAway.
- You can walk a dog using a platform like Wag.
- You can train people using fitness platforms like Peloton.
- You can create a blog or a vlog.
- You can start hosting a podcast.
- You can be a software designer or a writer using Upwork and Fiverr
There are so many side hustle ideas that you can use to make extra income. Indeed, we have seen many people make so much money using their side gigs such that they leave their jobs for them. You can use this side income to pay off debt.
Pay Off Debt Faster: Get a Part-Time Job
In addition to having a side hustle, we also recommend that you get a part-time job. In the United States, the average work week hours are 34.5 or 5 hours every day. In an entire week, there are 168 hours. This means that you can add some more hours and make some extra money. For example, if you work on a shift from 9 to 5, you can add two more hours every day and go home at 7pm. You can use the additional income to pay off your debt. Indeed, as financial advisors, we have helped too many people achieve financial freedom by just adding a few more hours.
Pay Off Debt Faster: Manage Your Money Well
A common reason why most people fail to pay off their debt faster is that they are not good money managers. In this, they spend their money in ways that are not wise. As such, they tend to spend their funds on unnecessary items. For example, we know people who are always the first to buy an iPhone when it is launched. We also know people who spend a lot of money on clothes. In the United States, the average person spends more than $2,000 on clothing every year. You can use money management strategies to save a lot of money and pay your debt. To do this, we recommend the following:
- Use money tracking applications like Mint.
- Prioritize your spending.
- Carry exact cash every day and leave your credit card at home.
- Avoid wasteful spending like buying Starbucks coffee
Pay Off Debt Faster: Sell Your Junk
Another easy strategy you can use to get out of debt faster is to sell your junk. Sell items that you don’t need and use the proceeds to pay off your debt. Many Americans have a lot of junk that is worth billions of dollars. For example, you can sell the one-year phone you are disposing of because you have bought an iPhone. You can also sell your junk car that you rarely use. Fortunately, there are many ways you can use to sell your junk. Some of the common platforms you can use are:
Pay Off Debt: Cancel Subscriptions
We are in an era of subscription. An era where Microsoft tells consumers not to buy its Microsoft Office that costs for more than $150. Instead, the company asks its consumers to subscribe to Microsoft 365 that starts at $8 per month. The company does this because a subscriber is usually more valuable than a person who buys a software one-off. There are hundreds of subscriptions today. Surprisingly, we don’t need most of these subscriptions.
For example, as a family, you don’t need multiple Netflix subscriptions because you can share one. You also don’t need multiple Spotify accounts because you can share one as well. Therefore, we recommend that you list all the subscriptions that you pay every month and cancel subscriptions you rarely use. You can use several apps to monitor and cancel your subscriptions:
These are some of the easiest methods you can use to pay off debt. The strategies will not cost you a thing. In fact, most of them will make you increasingly more productive. For example, listing your property on Airbnb does not make you lose anything. It can actually make you make new friends. Similarly, selling your junk can help you cut on those heavy storage costs.
Crispus is a finance professional with more than a decade experience in the industry. Over the years, Crispus has written in-depth articles on leading platforms like CCN, Marketwatch, and Seeking Alpha. He also runs a Forex education and managed account company called WestEndFx.