How to Cut Your Spending In Half, Payoff Debts, And Save Money
There is a good chance at one time or another you will face a time where you have gotten in over your head with debt. Maybe you were 18 and were sent your first credit card; maybe your first car loan was not as easy to pay for as you thought it would be. But, no matter how you got there, the fact is that it is hard to get out of debt.
How Did You Get Into Debt in the First Place?
There are many ways individuals can get into debt. For example, many uninsured or underinsured people who have a medical emergency can quickly become overwhelmed with the doctor and hospital bills.
One of the leading causes of debt currently is individuals who have mortgages. As of 2020, mortgage debt has reached $10.4 trillion, the highest it has ever been. In addition, the cost of owning and maintaining an automobile can quickly lead you into trouble, especially when your car breaks down. Finally, student loans are crippling college students. As a result, students are in debt before they graduate college. Then there is credit card debt. At 18, banks start sending you credit cards, and unless your parents taught you, you are clueless about how to use credit cards responsibly.
While bankruptcy may not discharge your student loan debts, it can help with other types of debt. When trying to keep up with their student loan payments, students can incur debt from credit cards, car loans, and day-to-day living expenses. Speaking with a qualified bankruptcy attorney can help students better understand debt and the importance of spending habits.
How to Change Your Spending Habits
The first thing you need to do is cut up your credit cards. Another trick you can do if you want to stop using your cards is to put them in a plastic bag, fill them with water, and freeze it. Freezing it will keep you from mindless spending and helps stop impulse buying.
To change your spending habits, you first need to know what they are. Do you go out to eat more than you should or spend your bill money on clothes? If you do either of these, it is time to create new habits.
Create a Budget and Stick to it
Budgets are essential for cutting down debt and finding simple ways to save money. You will be surprised just how much money you can save just by creating a budget. The more you know about where your money goes, the more you pay attention to when you are spending it.
Negotiate your Debt
Call your creditors and see if they will make payment arrangements or make a deal. You can also call your credit card companies and ask them to lower your interest rate. Many times companies will make a deal just to avoid sending you to a debt collector. Make phone calls to your cable providers, phone company, insurance company, and other bills you pay monthly and ask for discounts, the worst they can do is say no.
Prioritize Your Debt
Instead of trying to tackle all of your debt at once, choose one to pay off first while still making payments on the other. Attempting to pay off all of the debt at once can seem nearly impossible but paying off one at a time is doable. The best idea would be to pay off debts with the highest interest rate.
Increase Your Income and Save Money
One of the best ways to increase your income is to look around your house. How much stuff do you see that you no longer use and is just taking up space? Sell it. You can easily make a few hundred dollars selling things you no longer need.
One of the easiest ways to save money is to shop with a grocery list, use coupons and look for sales. There are unlimited apps on phones that give you cash or some other incentive for scanning items on your receipt.
Look at your bills. Do you have expenses you do not need? For example, if you have cable, are you watching all of the movie channels? Cutting down on cable can save you a lot of money., There are so many options now for TV shows that cable is not even needed.
Saving money may seem like an impossible task, especially if you’re in college. With a few changes and learning to create a budget, you will be surprised at how many changes you can make. It is possible to get out of debt when you talk to the right people.