How To Be Debt Free: A Few Useful Tips

Every day can put new pressures on peoples’ finances, whether it’s managing redundancy or seeking to fund your own business. The cost of living seems to always be on the up, and our families often need more and more financial assistance.

It can be a challenge to stay out of debt, and an even greater one to break free if it happens. This article provides some helpful tips for people who want to remain in the black, and also for those who are already in the red. Do you think this could help you or someone you know? If the answer is ‘yes,’ read on.

Get Outside Help

If the situation is small enough you may be able to sort your financial issues by making a few changes, or by receiving a friend’s advice. If the issue is too big to resolve, you may need to approach an external company or debt organization. If you get the right support soon enough, it could reduce the implications longer term.

Sometimes people find themselves needing a licensed insolvency trustee who can provide assistance with the process of filing a consumer proposal or declaring bankruptcy. These professionals will be able to help you determine if either one of these options may work best in your situation, and they can guide you through each step along the way.

You can discover free helpful information by visiting specialist websites that are dedicated to this issue. You can get advice from a licensed insolvency trustee or a debt relief specialist who can help you consolidate your debts. It’s often possible to read FAQs and book free consultations online, so you can gain a focused strategic plan. This could help you become debt-free and re-establish your credit rating.

Create A Budget And Stick To It

Sit down and calculate a budget that is realistic and workable with your income. Write down all of the expenses you will have for each month, including rent/mortgage payments, food costs and transportation to and from work or school. Also consider medical bills and insurance premiums (e.g. car, house or health insurance). You could either use an Excel spreadsheet, special software or a downloadable phone app to work everything out.

Once you’ve done the math, try not to spend more than your budget allows. Keep a close eye on your spending throughout the month to ensure you will have money left over at the end. If you can cut up your credit cards, do so. This will remove the temptation for you to buy things you can’t afford. 

Seek Other Ways To Release Money

One way to free up extra funds is to sell things you already have. You may have upgraded something but kept the old version, or may have hobby items that you no longer use. Don’t forget that there are many online marketplaces where people can buy from sellers just like you, so it might be worth having a look on Amazon Marketplace or Gumtree. Perhaps you own two cars when you only need one. If you sell the extra vehicle you’ll be able to pay off the debt much faster.

Another method is to stop subscriptions that are not necessary anymore, such as magazine or newspaper deliveries. If you no longer pay $20 a month for a subscription, that’s the equivalent of giving yourself a $20 a month pay rise. If you are paying for a gym membership but don’t go, release yourself from the contract. If you have a holiday booked, it may be wise to cancel it. Have a staycation instead, until you are solvent once again.

Consider Extra Work Options

It may be that you can find a new job that pays more, or there are overtime options at your current employment. Alternatively, you may be able to pursue promotion. Whilst this may involve longer hours or greater responsibility, it could be a valuable (and sustainable) way to resolve your financial worries. 

If you own a car you could consider taking on a taxi job during the evenings or use it to deliver takeouts. You may have a side hustle you could pursue, such as babysitting, pet sitting or dog walking. Other examples are blogging, self-publishing and tutoring.

Don’t Waste Money

Don’t use up your precious funds on paying for unnecessary things. Don’t buy takeouts every day or keep going to expensive restaurants – prepare your meals at home. If you plan to socialize with friends, choose cheaper places to meet up instead of going to a club or bar where you will spend more than necessary for drinks and entertainment. Perhaps you can meet around one another’s houses on a rota basis.

Do online research before buying anything so that you don’t overpay. Price comparison websites can do much of the work for you, saving you both time and money. Make the most of flash sales, new year sales and Black Friday deals. Also consider buying things secondhand rather than new.  Ask yourself questions before you pay out – do you really need that Netflix subscription, fashion item or latest gadget?

Put Money Aside Weekly

Don’t see your monthly budget allowance as something that should be completely spent. Try to put aside savings weekly, even if it’s just £20 or $30 – you will soon see the figures rise over time. It could also help to set up an automatic savings transfer using your bank app on your phone so that any spare change is sent straight into savings at the end of each day/week without you having to think about it. The benefit to doing this is you will be able to have an emergency fund in place to cover any unexpected bills (e.g. medical, car, etc.).

Hopefully these tips have made you feel more powerful in your current situation. You can now budget your finances, watch your spending and get out of debt quicker. If you put the right measures in place you will have more money when you need it, both now and in the future.