No one likes taking the time to pay down their debt. It is just one more thing to remember and it can be a challenge when trying to figure out how to come up with the money to pay the next bill. However, if you always see paying down debt as a mountain in your life, it will always be a huge topic. Instead, if you change your mindset to how capable you are, or even challenge yourself, paying down your debt becomes easier. Here are some things to make sure you know when it comes to paying down debt.
Your Mind is One of the Biggest Roadblocks
There is an old saying that applies to nearly any topic, including this one. Henry Ford is known for saying, “whether you think you can, or think you can’t – you’re right”. This quote from the 1940s refers to the fact that your mind is going to determine your success. If you want to be successful, you have to go for it, no matter what “it” is. When it comes to paying down debt, you have to decide how much money you can put towards that debt each month. Then, you have to stick to it. You must set aside the same amount, or more, each month and chip away at that debt, no matter how large it may seem. If you see yourself succeeding, you are far more likely to do so. If you only see that mountain in front of you, your ability to stay focused on chipping away at that total balance will waiver.
Make Paying Down Your Debts a Personal Challenge
One of the most effective ways many people pay down debt is to make it a challenge. They want to see if they can pay it down before a deadline or how quickly they can get it done. This is often inspiring to them, getting them to reach out and find new ways to pay down their debt. Instead of just taking 10% of their standard income, for example, maybe they opt to go get a side gig and use 80% of that income for their debts. Many people thrive on competition, and even competition with yourself can be motivating. It is all about the mindset of letting yourself see just how efficiently you can pay for those debts.
You Have More Options Than You May Realize
So, you have decided to pay down the debt. Congratulations on your first step. Now, you have to look at how you can pay it down. Here are some options that could make the process a little easier.
- Save a Percentage from Each Paycheck: The easiest way to pay down debt is to set aside the same percentage of each paycheck you receive. Take this percentage and always put it towards the debt with the highest interest first. That way, you pay fewer fees and interest charges in the long run. When your balance goes down, your payments stay the same. This pays down the debt quicker for you.
- Figure Out Ways of Extra Income Where You Can: Getting a second job that you do a day or two a week can go a long way towards paying down your debt. It gives you something active you can do to keep yourself focused on that challenge. If possible, use all of that income, after paying for things like gas and food, and put it towards your debt. The sooner your debt is paid off, the sooner that income becomes savings.
- Look for Ways to Pay Down More: Look around and see if you can make the percentage of your income devoted to debt a little higher. Maybe lowering an expense or two can help. You can also do things like consider a reverse mortgage. There are many lenders, so make sure you do your due diligence with places like https://reversemortgagereviews.org/ to ensure you are getting the best offer. You may find that these simple changes allow you to pay your debt down faster than you ever realized was possible.
When all is said and done, you need to keep in mind that you have control over your debt. It is up to you how much debt you take on in the first place. If you want less debt, pay off your credit cards and leave them put up in case of an emergency. Do not keep adding to them. It simply makes the job more difficult. Keep a certain amount of money off to the side each month and pay down your highest debt as quickly as you can. Once the highest interest debts are done, use the same money to pay off more of the smaller debts until they are all gone.