6 Steps and Strategies to Be Debt-Free

Living a debt-free life might be a challenging goal, but it’s also attainable and 100% worth working toward. Learning how to manage your money is going to take some knowledge, effort, and skill. However, the financial freedom that comes with being debt-free will make your hard work worth it. 

With a few simple strategies, living debt-free might not be as challenging as you may think.

Read on to learn the top 6 strategies to becoming debt-free!

#1 Reign in Your Spending

You probably saw this one coming, but if you want to start living debt-free, you’re going to have to re-evaluate your spending. We know it’s tough, but cutting down on discretionary spending can make a world of a difference. 

If you’re struggling with minor credit card debt, it might not take long to see your hard work start to pay off. If you’re struggling with significant debt, moving the needle will take a bit longer, but so long as you’re cutting out unnecessary spending, your situation will improve over time 

#2 Take Inventory of Your Debt

Being in debt is a problem, and looking at your problems straight on can be challenging. However, if you’re serious about getting and staying debt-free, you’re going to have to take the initiative to organize every facet of your debt. 

As you start to make a game plan to get out of debt, start by gathering the following information:

• Who do you owe?
• How much do you owe them?
• What are the interest rates on your debts?
• When are your payments due?

#3 Increase Your Income

This may seem like an oversimplified solution to a complicated problem, but finding ways to increase your income can drastically change your financial situation. 

If you’re looking for ways to boost your cash flow, keep the following tips in mind:

• Put Your Talents to Work – Although being in debt doesn’t isn’t a situation anyone wants to be in, being in debt in an age where freelancing opportunities (and the gig economy as a whole) is in its prime makes it easier to generate supplemental income.  No matter what your skills are, there’s likely a way to monetize them. A great way to generate supplemental income using your talents is by becoming a sales representative for Vector Marketing. Don’t be alarmed by the Vector Marketing Scam talk, learn what it’s truly like working for Vector Marketing.
• Use Your Extra Income Wisely –When you start making more money, it’s tempting to start spending more money on things like shopping or eating out. Resist the urge to use your extra cash to treat yourself, and instead dedicate the money to paying off debt.
• There’s More than One Benefit to Making More – Whether you take up a side hustle or start working more hours at your current job, making more money means you’ll have less time to spend it. Earning extra income kills two birds with one stone! 

#4 Don’t Ignore Your Taxes

The best way to avoid getting into tax debt is to be diligent about doing your taxes correctly and on time. However, we know it’s easy to get behind on tax payments, and since we can’t suggest using a time machine to turn back the clock, we can suggest a few options for if you’ve run into IRS issues. Just remember to try and stay on top of them next year.

If you’re struggling with tax debt, consider the following options:

• File for currently uncollectible status
• Apply for the IRS Fresh Start Program
• File for an offer in compromise
• Work out an installment plan

#5 Set Attainable Goals

The larger the debt you’ve accumulated, the more daunting getting out of it can seem. Breaking your get-out-of-debt plan into smaller, achievable goals can help ease the mental burden. Setting milestones will also make you realize that there is a light at the end of the seemingly endless debt tunnel.  

#6 Give Yourself a Pat on the Back—You Deserve it!

If you’ve read this far into this guide, congratulations. You’ve already taken a great first step towards living a debt-free life. It’s easy to let debt creep up on you, and by educating yourself on ways you can avoid sinking farther and farther into the hole, you’re already arming yourself with the tools you need. 

It’s Time to Start Putting Your New Knowledge to Work

Our last piece of advice is to start tackling your debt sooner rather than later. We understand how easy it is to put off taking control of your finances, so we’re here to encourage you to take the plunge. 

If you need some motivation, just imagine how incredible it will feel to live debt-free!