2 Ways to Get Out of Debt
So now I have determined that credit card debt is the sole reason for my budgeting misery. You might be in the same boat. After analyzing your budgeting worksheet, you know that the debt payments are sucking your cash flow each month. How do we get out of it? Now this is the tough part. You need to buckle down on this asap. I need to get this financial snowball under control. I have determined that there are only two ways to get out of debt, or more specifically two ways to increase the monthly cash flow (cash left over).
After consulting your budget, you need to focus on the bottom line or rather the money left over after each paycheck or end of the month. The first way to get out of debt is to make more money. Now I know you are sitting there saying ok Joe what? I hear you ok. My situation doesn’t allow me to just get promoted or go in and ask for a raise. I can’t just make more money.
You can make more money though. Ever heard of a side hustle? A side hustle is something you do in addition to your day job or full time job to earn some extra cash. Some of the most popular side hustles are Uber driver, starting a blog, walking dogs, babysitting, mowing grass, and etc. A side hustle is a proven way to increase the cash flow and help you get out of debt. Now I could sit here and list 100s of side hustle ideas, but I am not about that life. There are plenty of resources on the internet dedicated to helping you with side hustles, Google it.
The most important part of budgeting is seeing where your money goes each month. Now with this new found vision, you can see places you spend too much money in. So that is where the second way to get out of debt comes in. You might need to focus on cutting expenses. Yes I know this is extremely difficult, but if you are in debt and want to get out this is a must.
There are many categories in most budgets that can be cut. The TV or internet bill can be cut down. I have TV service, but rarely get to watch it. My kids don’t watch TV, they prefer to watch Netflix. You will be surprised how much money you can save and how little you will miss the TV service. You could also cut that cell phone bill down by going with a different carrier. Groceries are a huge expense in my family, and this expense can be cut down by meal planning or couponing. There are tons of ways to cut expenses, and when you are budgeting you need to identify some things that can be cut.
After you cut expenses, you need to use that extra money saved to put towards your debt. The more things you cut the more cash flow you will have. If you want to get out of debt like I do then you have to make sacrifices. This brings to mind a quote and truthfully I don’t know where from but it says “You have to live like no one else, so you can eventually live like no one else.” Now I take this to mean we need to sacrifice now, so later on down the road we are debt free and we can live better. Next time I will start to tackle my expenses.