Raise your hand if you love debt.
Crickets?
That’s what I thought.
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I remember looking at my income statements and realizing how “in the hole” I was. I was $63,000 in debt, living in my family’s extra bedroom, and looking desperately for a job. Sitting down with my aunt to go over my budget made me start bawling. The reality of the situation had hit me like a ton of bricks.
But I did it.
In just 15 months, $63,000 was paid off. This means that I was able to pay off an average of $4,200 per month for 15 consecutive months.
Here’s the deal: getting out of debt is hard, but it’s worth it.
I’ve never worked so hard for anything in my life. To say it took a lot of sacrifice is an understatement; but, like I said, it’s worth it.
So, how did I do it? Here are my tips and tricks on how to get out of debt and FAST.
1. Create a Budget
Yes, I said it: the B word.
This is where a lot of people go wrong. They form a budget out of numbers they picked out of thin air. I see it all the time: a budget of $200 for a family of 4. While this is doablefor some people, it isn’t realistic for others.
The only way to know what a realistic budget is for you is to consult your bank statements. It is there you’ll see what you’re actually spending.
It’s going to be tough. Not because simple addition is hard, but because you’ll see how much frivolous spending you’ve been enjoying. Add up how much you’ve been spending in each category: groceries, eating out, mortgage/rent, personal care, utilites, car payments, gas, debt, etc.
2. Trim the Fat
No, actually. Get rid of all of the excess spending. Trim. That. Fat.
Once you have added up where your money is going, you can see where you can cut. It’s a little more difficult to cut immediately on something like rent or a mortgage, but it’s easier to cut on things like personal expenses or even car payments.
This one hurts. This is where you’ll be really looking in the mirror and picking out where you’ve “let yourself go.” Don’t be intimidated! This is where the magic happens.
Personal example time.
I bought my dream car, but it came with a car payment of $311 per month. Ooph.
When I added up my expenses, I knew that this car had to go. Worst of all – I was upside down on it (meaning I owed more on it than it was worth at the time).
I ended up selling that car and downsizing significantly, paying cash for something more affordable. Not only did I lose that pesky car payments, I also got rid of a gas guzzler and higher insurance fees, leaving more money in my pocket than I originally anticipated.
3. Make More Money
I don’t say this lightly. Making more money is difficult. It requires time, energy, and sacrifice.
There are two ways to get out of debt faster: to cut down on expenses or to make more money. If this isn’t a feasible option, then stick to trimming the fat off your expenses. But, if it is an option for you, take it on and run with it.
Personal example time.
My job wasn’t flexible enough to add another job from another company. It would have been impossible to stick to a schedule. So, I started my own side hustles that allowed me flexibility to work around my full time job.
Side Hustles to Earn Extra Cash
Selling Online. I’ve already discussed How to Sell on Facebook Marketplace Like a Boss. That is one way I earned a lot of extra cash (in this post, I talk about what I did to sell $2500 worth of items in 3 weeks!). I essentially marketed my marketing skills by offering to sell other people’s items for a commission. AND IT WORKED.
I have a huge crush on Facebook Marketplace, but there are a lot of other great options out there as well. I sold a lot of people furniture using Facebook Marketplace and Craigslist, but what about smaller items? Items like clothing or smaller household items, I would sell on Poshmark (if you’re new, use POSTCITYSALE for $10 off) or Mercari (new users, click here for $10 off). Both companies take a commission, but they’ll be connecting you to people you would’ve never had the opportunity to connect with and sell to.
Dog sitting / Dog walking. When I didn’t know what I was going to do for extra cash, I started out dog sitting. The families would pay me per day to either stay at their house while they were away or to visit during the day and take care of their pups. It gave me exercise, but it also allowed me to work dog sitting around my busy schedule. Apps like Wag will give you the opportunity to connect you with people. I use Wag for my own pup as well. If you want to try it out before you sign up to work it, use this $5 off code to try.
Wag does take a cut of what you earn, so if you’re wanting to grassroots market, some simple flyers in mailboxes or posting in your local area might just do the trick. If there’s a will, there’s a way.
Downsize. Ew. A lot of people don’t like this option, but looking around at what you do need is a way to sell stuff. Whether it be a garage sale or posting online, get rid of it if you don’t need it. It’ll help you with your organization, but it’ll also help you with making that money!
Pick up overtime. This goes for the hourly folks, but picking up that overtime at your current job is a great way to make that money. When I was on my debt free journey, I was salaried, but you bet I would’ve signed up for overtime if I was hourly!
Pick up a Second Job. A lot of my get-out-of-debt friends were able to pick up a second job. They applied to Uber Eats, Pizza Delivery, Lyft, or Uber. Like I said, this isn’t something that I was able to do, but I know they were able to make money out of it. Had I had more flexbility, maybe I would’ve been able to do something like this.
Get creative. A long time ago, to make money, I learned how to make jewelry and opened up an etsy shop. Did it do well? No. But don’t let my misfortunes swade you. I didn’t stick with it and realized this was not my calling. If you have a calling to bend some wire and make super cool stuff, DO IT. I have a few friends making bank on etsy!
4. Don’t Give Up
There comes a time in everyone’s budget when they completely mess up their budget. We’ve all had a plan and it all goes awry. Whether it’s a medical emergency, a car breaking down, the air conditioning going out, or you just decided that a filet mignon at your favorite boujee restaurant was imperative, something is bound to come up.
And that’s okay.
You aren’t perfect. Budgets fail sometimes. But, if you’re prepared, breaking your budget once won’t set you back too far. Don’t let it tear you down. And, as always, learn from your mistakes.
5. Set Aside Some Cash
I followed Dave Ramsey’s guidelines for getting out of debt (and I’m currently following his steps for building financial freedom). His first baby step is to save up $1,000 as an emergency fund.
In an emergency, $1,000 doesn’t sound like a lot. But it sure does cushion the blow when you’ve gone beyond your budget. If you have nothing (and I mean ZERO, zilch, nada) to fall back on, rebounding will be more difficult, mentally and physically. Think of the $1,000 as insulation. You’ll be able to bounce back better with that net.
Nobody said it was easy, but when it’s done, it’s incredibly rewarding. You’ll be shocked to see exactly how much money comes back into your pocket too.
If you have tips that I didn’t mention, leave a comment!