Tuesday, September 9, 2008

Back to Basics Post 7 How to Get Out of Debt Faster

If you are just finding the Back to Basics series you can find all of the posts in the series by clicking on “Back to Basics” in the sidebar. So far we have discussed tracking our money, finding money in our budgets, saving for an emergency fund, things to do before you start repaying your debt, and how to choose and implement a Debt Snowball.

Today I want to tell you how to get your debt paid off even faster.

The first time I ran my figures through Dave Ramsey’s Debt Snowball Calculator and saw it would take us 53 months to pay off our debt I was a little upset. I wanted it to happen faster obviously. Well, I forgot about a few things. Number one you can make it happen SOONER!!

This is known as Debt Snowflaking. Think of a snowball. Obviously this is where most of your efforts are focused. A big ball made up of all the extra pennies you have to throw at your debt each month. A snowflake is the same thing, just on a much smaller scale. (Although not always.) A snowflake is when you get extra money during the month and you add it to your debt before you can even think of what else to spend it on.

Many people use a change jar for this. Whatever money is for spending each month goes into their pockets, but when they come home at night they put any coins into a jar. At the end of the month they money in the jar is cashed in at the bank and immediately that money is transferred to the debt you are working on.

I have found many other ways to do this though. You can have a yard sale. All the money from the yard sale goes to the debt.

I shop using coupons and often there will be a rebate on a product I use. I apply for the rebate and when that check comes it goes to the debt.

If I get unexpected money it goes toward the debt. Recently I got a check back from one of our doctors for overpayment. I put it all toward my credit card.

There are also many websites online that will pay you for surveys etc. If you look at the sidebar up top there are several links to places like CashCrate, Survey companies and Cash4Books. I have gotten money from all three of these and have used it to pay my debt down even more.

I have also begun to sell items on Craigslist and Ebay. That money is still waiting in my PayPal account to be transferred.

I promise if you look hard enough you can find ways to pay off your debt. Get creative. The more you can do the faster you will be out of debt.

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