Paying down debt can make it easier to obtain financial security both now and in the long run. You will be able to choose where you work, where you live and whether or not you can start a family when you become debt-free. This is because a larger portion of your earnings can go where you need it to go as opposed to giving it to a lender or other creditor.
If you are deep in debt, you should work as many hours as your boss will let you. If necessary, get a second or third job to increase your chances of making money even when your current employer caps your hours. While the second or third job may pay less than your full-time occupation, it doesn't have to be a formal role with an established company. Instead, you could referee kickball games or work as a camp counselor.
The gig economy lets you earn money as a driver, food delivery person or freelance author in your spare time. All you need to do is have the ability to work in the United States and the tools to do the job to get started. As you can generally control your own hours as a freelancer or self-employed individual, it may be possible to work multiple jobs without jeopardizing your home or social lives.
Instead of spending a night out on the town with your friends or spouse, it may be better to use your money making an extra credit card payment. It could also be a good idea to make an extra mortgage or auto loan payment instead of going on vacation this summer. While you don't want to become a complete hermit, paying an extra $50 a month on a credit card or an extra $500 a month on a car loan helps in two ways.
First, it reduces your debt balance, which reduces the interest paid on the loan. Next, with a home or car, making extra payments allows you to build equity faster in that asset. This can make it easier to trade or sell it while still putting money in the bank.
If you have been spending $100 a month on housekeeping services or $50 every two weeks on a lawn mowing service, it may be time to fire the hired help and do the work yourself. Even if you simply mow your own lawn for a few months, it can produce significant savings that can be used to get closer to debt-free.
At the same time, you can get exercise and spend some time outside, which can be good for your health. That can lower your odds of developing conditions that could send you to the hospital or otherwise result in higher health care bills. If you have children, ask that they contribute to the household chores to ensure no one person is doing all of the work.
One way to cut spending is to get rid of the credit cards. This forces you to use only the money available in your checking account. That can help you stay away from the online shopping or other unnecessary purchases that make it harder to pay down your balances. Furthermore, not using your credit cards allows you to build up your credit score as your utilization rate goes down. When you are ready to take on debt again, it will be cheaper to borrow because you are less of a risk to a lender.
While your children may not be able to get everything that they want this year, saving money today could help in the long-term. For example, putting money earmarked for a new toy into a college savings account can prevent your children from accruing as much debt in the future. Cutting down on holiday shopping can also leave more money to put toward other bills or adding to your emergency fund.
Installing an antenna in your home can make it possible to watch the news, sports and other local programming without having to pay for it. Going to a traditional phone or a prepaid smartphone plan can be much cheaper than the typical smartphone plan that can cost $100 or more per month. After awhile, you may find that not having unlimited channels or unlimited data on a phone merely gives you more time to pursue your interests. Once you are out of debt, you can spend more money on those interests instead of on cable channels that you don't watch.
By making short-term sacrifices today, you may find that it is easier to secure a stronger long-term future. While it may be difficult not taking a vacation or having to mow the lawn on a day off now, the ability to live or retire comfortably in the long-term is well worth it.