Today has been a GOOD day! I paid off another one of my debts! Whoo! I have been trying the past two years to really try to crack down on the debt that I have, because it was ridiculous how much I/we had, so it’s a BIG deal to me when I finally pay something off. Sending in that last payment is pretty much the best feeling ever. So, since I am pretty fricken happy about it and can’t stop talking about it, I thought I would share with you some of the things I did to put a dent in the amount we had. I am by no means a professional debt buster, and these may seem all wrong to you, but this is what worked for me!
So how did I do it? Nothing crazy, basically I would focus any extra money that I did have and put it towards one of my debts. But the biggest problem with that is that sometimes it’s hard to find that extra money. I mean, duh, if we all just had tons of money lying around, we wouldn’t be in debt in the first place. It seemed like after bills, there was hardly anything left at all to buy gas, food, etc.
One of the ways that I would accomplish this is that I would over budget for my monthly payments. For instance, let’s say my Sears card had a monthly payment of $23. Well, if you look on your little statement sheet, it shows that if you pay just the minimum balance of $23 to pay off your balance of $1600, it will take you approximately 9 years and you will pay an extra $2000 (just a made up example since I can’t remember my exact numbers ;-) ). F that. I knew I didn’t have a lot of money leftover after bills, but I knew it would be absolutely ridiculous if I followed that payment plan. So what I did was I had a list of bills every month that I have to pay, and instead of putting that $23 in there I would list my Sears at $50 a month. That way I was putting an extra $27 a month right off the top on my balance. Then if I had extra money, I would add that to it, too. So sometimes I would send in just the $50, but other times I would send in $75. At the very least, I round up to the next $10 amount. I really notice the difference on things like my car payment. They basically apply it towards your owed balance, so it shows your bill is lower and lower each month, so all of the extra you are sending in is going straight to the principle. That means you pay less interest in the long run. Even doing those few $$ really adds up!
Another thing I would do- if I did something extra, whether it was babysitting, mowing my sister’s lawn (which I did all last summer!), sold one of my crafts- whatever it was, if I got paid in cash, I would go put it in my secret stash place and I would walk away. I wouldn’t count up how much I had in there, I wouldn’t think about it, I wouldn’t use it, nothing. I would just forget about it. Then every once in a while I would gather it all up and I would have an extra $100! Then I would pick which card I wanted to put it on and add it to my payment that month.
Do you use the facebook classifieds? You know, where you can post stuff for sale and people comment to buy it? I do. Like, ALOT. After Chris and I split, there was alooooooot of stuff that we had to go through and sort who’s was who’s. That would be when I realized just how much stuff I had stuffed into my house. I have a big ol’ house, and it can hold alot of stuff apparently lol. I found stuff I hadn’t seen since I bought it four years ago! Needless to say, it was time to start clearing the crap out! Then when he actually moved out, he just left a TON of stuff for me to deal with. So I have been posting stuff for almost a full year now pretty regularly, with great success. This has been my biggest ‘debt buster’ for sure. Even when people would say, seriously, it’s $2, just toss it. No, no, no! That $2 can go in my stash, it is one less thing in a landfill, AND it was something that someone else can use. You would be amazed what people will buy. Some of it I sold at a big discount, but since the two thrift stores in our town closed down my options were to either haul it an hour away, find someone to buy it (even if it was for super cheap), or toss it. Now which of those options sounds like the best one? A little bit of money is better than no money at all. Not to mention that my house is SO much cleaner and less cluttered. I also had friends that would want to get rid of stuff and I would either sell it for them, but mostly they just gave it to me and said it was ok to sell it and keep the money. It got it out of their house and I was able to earn a little extra cash. Win win.
Something that I should have thought to do beforehand is to CALL the credit card company and see if there’s anything that they can do to help you. Sometimes all it takes is an “I’m going to close this card as soon as I get it paid off” to get them into action. After I had paid my card off, I contacted the company to let them know that I wanted to close the card. When they asked why I let them know that their interest that they charged was at a pretty ridiculous rate. They responded back that they looked into my account and they I had qualified for a special interest period and credited my account over $600! I wish I had called them sooner! It’s definitely worth a phone call.
Of course there is also the same old cut down on eating out, don’t go shop crazy, see if you can cut your phone bill down, turn off your cable, yadda yadda. Those are all good things to do, too. But these are a few of the things that I have made an effort to do on top of all of those to put a dent in my debt. I am down to a small balance on one card and a bigger balance on another (but that one is complicated because of the divorce….I don’t know how to pay that one off early without messing stuff up). My (albeit lofty) goal is to be completely debt free. It may take me a while, but it’s still my goal.
Do you have any tips and tricks to pay off your debt early? Please share!