6-minute read

Hello, beautiful people from across the lands! As I shared last week my debt is going to be a challenge but it’s one worth taking. If you didn’t read last week’s post My Starting Point: $91,370.18 in Debt & in the 500 Club be sure to read it. I also share free financial tools that can help you find your starting point as well.  So what’s the game plan? 

In this post, I’ll discuss ten different strategies to take and which ones I’ll be putting to the test.

Here is my initial plan to become debt-free.

  • Step 1: Save $1000 in an emergency fund
  • Step 2: Pay off debt using the debt snowball method
  • Step 3: Celebrate along the way

Now let’s dive into these different approaches!

1. Create A Budget

One of the most fundamental steps is to create a BUDGET. This was foreign to me some odds months ago but boy oh boy how it has aided in changing my spending habits and money management altogether. 

I am old school when it comes to budgeting, a good ole pen, and paper suffice best for me. I did briefly use the Every Dollar app and heard about Mint. I have a free budget template you can use to get started. Whatever you do, just create a budget fast!

I have a free budget template you can use to get started.

2. Save An Emergency Fund

Saving an emergency fund prior to tackling your debt is a good financial sense that apparently, I didn’t have. 

It is important to have something put aside for a rainy day. 

Let’s face it “hick-ups” and “uh-ohs” happen unexpectedly and sometimes the timing couldn’t be any more perfect. 

I swear my car knows when any little extra money comes and decides to make plans with it. 

A decent amount to put aside for an EMERGENCY is $1,000. 

Ideally, you want to save 3-6 months of expenses but $1000 is a good start. 

3. Debt Snowball Method

The debt snowball is commonly associated with Dave Ramsey an expert on personal finance. With this method, you simply list your debts from smallest to largest making minimum payments on all your debts except the smallest. You aggressively pay it off ASAP! Once finished you repeat with the next debt and so forth.

4. Debt Avalanche 

Now, this method is the opposite of the debt snowball. 

The concept is to rid the highest interest rates first while making minimum payments. 

I’ve heard success stories from both methods but find the debt snowball to be more commonly used. I found an insightful article from Forbes comparing the two methods. Ultimately the decision is yours and how you plan to execute your debt is solely up to you.

5. Pay More Than the Minimum

Both the debt snowball and debt avalanche rate payment methods suggest paying MORE than the minimum. 

The idea is to pay the debts off quickly to beat the accumulation of interest on your payments. 

Making changes like weekly payments vs monthly.

 If the minimum payment is $100 make it $200 to help create the momentum of getting rid of this awful burden called debt.

6. Sell Unwanted or Unused Items

Look around your home and discover what items you can get rid of and make a profit. 

Some of us have a whole boutique right in our closets with clothes, shoes, bags barely worn, or worse still tags! What items around the home can do without? I’ve listened to debt freedom stories of people selling condos, cars, homes, and other possessions to get out of debt

This is when your “Why” must override your emotions to detach from things that are keeping you in financial bondage. You are not in this alone remember I’m on this journey too, learning these lessons as well. Just imagine life without payments, sign me up!

7. Find A Side Hustle

What skill or talent do you have that someone is willing to pay you for? 

Is it baking, sewing, simple car repairs, cleaning, babysitting, hair, web design, and so many others? There are also ways online like surveys, mystery shoppers, freelancing, and much more if you feel you don’t have the skill to monetize (which I know you do). The idea is to bring in the extra green. With your budget in play, you can track how this extra income affects your debt-free timeline. It’s time to become the side hustle Queen/King!  

8. Get an Extra Job

This may not be so attractive but possibly picking up a part-time job in addition to your full-time income. 

Remember these tactics are only in place for a season, not a lifetime. 

Possibly working during the holiday season when seasonal workers are needed desperately.

 Just think a whole EXTRA paycheck going toward debt. 

Now we’re cooking!

9. Pause Any Investing

Remember again this is just seasonal behavior. 

This approach is another Dave Ramsey method. 

Forbes has reported workers will loan from their retirement when hard times strike. 

Pausing your investments while building your emergency fund and paying off debt helps shield you from making risky financial decisions. 

Life will happen and when it does it’s better to have a working system in place to deal with it. 

10. Celebrate Along the Way

It’s important to have fun and some type of enjoyment while on this journey. 

Paying off debt is not sexy, or the thing people are posting all over social media. 

You usually see vacations, pictures of extravagant food, new adventures like swimming with dolphins, and feeding elephants. 

You know, all things that remind you of that your life is boring. 

A small treat to yourself while accomplishing milestones is vital and will help keep you motivated until the end. 

Just remember to fit it into your budget first!

Please share below what’s your plan or other methods you use to pay down debt. 

Until next time dream, believe, and achieve.