With the end of the year approaching quickly, most people are looking for ways to save money and cut their debt. Believe it or not, one of the most popular New Year’s Resolutions is to get out of debt. The bad news is that these resolutions often don’t get the attention that they need to be successful. The best way to make sure that you start the new year off on the right foot financially is to make a plan. Here are 8 ways that you can cut out some of your debt at the end of the year so that you can start 2017 the right way.
1. Work a Part Time Job During the Holidays
Around the holiday season, most businesses are looking for part time help. The holidays are so busy, especially in retail, so it is really not hard to get a part time job this time of year. If you want to make some extra money to pay towards your debts before the start of the New Year, this is a great time to do it. Take a look at your local job boards and apply for jobs that you may be qualified for. Any little extra bit can help chip away at that debt block.
2. Consider Cancelling or Freezing Your Credit Cards
One way that you can really get in trouble, especially over the holidays, is by racking up credit card debt. If you are worried about this, you may consider cutting your cards up, cancelling them, or at least freezing them. By doing this, you can focus on paying down existing debt instead of creating new debt.
3. Set Up a Debt Plan for the Upcoming Year
Sit down and write out a few of your debt relief goals for the upcoming year. Make your goals attainable, but also make sure that you make them where you have to work for them. Start by making a list of all of your debts and focusing on what you should pay towards first. Focus on debts that have higher interest rates to pay first, then go on to the creditors with lower rates.
4. Consider Consolidating Some of Your Debt
Debt consolidation isn’t for everyone, but for some it can be a life saver. If you are looking to cut your debt some, and make it easier to pay back, you may consider consolidation. Many lenders will consolidate your debts, paying your existing creditors, and giving you one new loan with one monthly payment. Often times, it is more affordable. Just make sure that you get a good rate on the consolidation loan, or it may not be worth it in the long run.
5. Don’t Overdo Your Christmas Shopping
It may be really tempting to buy a lot of Christmas presents for your family and friends, but cut back a little this year if you are focusing on cutting your debts. This will give you more expendable income that you will be able to put towards your debts. Many parents are using the four gift technique– one thing they want, one thing they need, one thing they wear, one thing they read. This can be an effective way to not only teach kids to not be as materialistic, but also save us parents some money.
6. Do a Purge of Things You Don’t Need, and Sell It
Just about everyone has some old stuff laying around the house that they don’t use anymore. If you do, gather it all up and have a little rummage sale. You can even use online yard sale sites on social media to sell your items, without the hassle of a yard sale. This can be a great way to bring in a little extra money to go towards those outstanding debts.
7. Try to Negotiate Lower Interest Rates with Your Creditors
To alleviate some of the interest that you are paying, you can always ask your creditors to negotiate a better rate. Some creditors are not as willing as others to work with you, but it never hurts to ask. Make a list of your creditors, and call them one by one. Use your negotiation skills to try to get a better rate, resulting in less interest paid over time. This is actually a great way to cut debt, even though it may not seem like it.
8. Pay More Than Your Minimum Payment
Finally, consider making more than just your minimum payment each month. When you only make your minimums, you are paying more towards the interest than anything. Whatever you pay over the minimum payment amount will go toward the principal of the debt. This will help you to get it paid off faster, and out of debt sooner!
As you can see, there are quite a few ways that you can cut your debt. We have given you a few things to get you started, but chances are you can come up with a few other ways as well. The good news is that your financial future is in your own hands. You hold the key to your financial freedom, but you must work for it. It is worth it!