Fast Way to Reduce Debt

Tackle your debt together and get out of debt fast.

Tackle your debt together and get out of debt fast.

Now that the honeymoon’s over, it’s time to get in gear and tackle debt head on. Debt -- especially the expenses nurtured since single life -- has a way of reappearing, not to mention the costs of the wedding and the honeymoon to deal with. Here’s a fast way to reduce debt without whittling your social life to bare bones so you and your spouse can concentrate on building your finances for the future.

Fast Way to Reduce Debt

Start lean. Build a budget of basic necessities that you both agree on, cushioned with a few bonuses for good behavior. Getting your spouse to agree with you may take a little give and take. But the goal is to set spending standards that both of you can agree upon.

Get a handle on your credit cards. Examine credit card interest rates and don’t hesitate to negotiate with lenders for reduced rates. If possible, pay off debt quickly by moving balances from higher-rate cards to lower interest-rate accounts.

Tackle secured loans. Carpooling to work will cut costs significantly if you can manage to do away with one car. If you both own property, rent one of the properties or sell the second home until you strengthen your financial position.

Strategize repayment plans. Dave Ramsey, debt guru and author of "The Total Money Makeover," explains that snowballing your debt is a proven way to pay off debt quickly and efficiently. Pay off debt with the highest interest rates first, while still making minimum payments on the rest of your debt, focusing on one loan at a time. When that loan gets paid off, use the extra money to tackle another debt until all the loans are paid in full.

Jump-start debt reduction. Clean your home and have a garage sale. Ask family and friends if they have anything they’d like to contribute to your garage sale. Use the proceeds to pay off your debt. Alternatively, sell your items online.

Start a side business. If you have marketable skills, use them to make extra money to pay off debt. Free classified sites can help you kick-start your new business savvy. In addition, you can check out eLance or oDesk (see Resources) for online opportunities that pay.

Request an interest-free loan from a willing family member, if all else fails and you’re in way over your heads. If your family sees that you’re serious about tackling your debt and that you’re doing all these wonderful things to make money, they may just be open to your proposal.

Items you will need

  • Budget
  • Loans statements
  • Credit card bills

Tips

  • Be creative but also realistic about the expenses you’re willing to do without. A budget does nothing for you if you don’t follow it.
  • Know the credit card laws in your state. Never accept a verbal agreement from your creditor as gospel truth. Get any changes to the terms of your loan in writing.

Warning

  • Income you make may be taxable and require business licenses. Consult with a tax accountant or lawyer to determine whether starting a business fits your needs.

About the Author

Based in Honolulu, Hawaii, Coreen Nishijo has been freelance writing since 2007. She holds a B.S. degree in chemistry from the University of Hawaii at Manoa and is also a licensed Realtor Associate.

Photo Credits

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