Paying down your debt can seem like a daunting task, but with the right tools and motivation, you can set yourself up for financial success! Here are three tips to help you get started on your own journey to financial freedom.
Create a realistic budget.
Nobody wants to set themselves up for failure. By calculating your monthly expenses and knowing how much you’re actually spending, you’ll be better equipped for creating a realistic budget – and sticking with it. One of the most common budgeting frameworks is the 50/30/20 rule. Learn more below.
Pay off your most expensive debt first.
Chances are, your debt is growing by the minute due to high interest. While some people choose to pay off their smallest debt first to create a snowball mindset effect, it may be advantageous to actually tackle your highest debt first. By paying off the highest interest rate balance first, you may pay off your debt in less time – allowing you to save more money later on.
Try making a list of all your credit cards and ranking them in order from highest to lowest interest rate. Then, pay off the credit card with the highest interest rate first by making high lump sum payments to that card each month.
Believe you can.
It may sound cheesy, but *actually* believing you can accomplish something is half the battle. Often times, carrying debt can come with feelings of shame, anger, fear, frustration, and more. But the day you welcome acceptance and let your debt’s hold on you go is the day your mindset can shift.
So how do you ditch the bad debt mindset? By acknowledging your negative mindset toward your debt and deciding to leave it in the past puts you back in control. Try saying it out loud, writing it on a sticky-note, telling a friend… just do something other than think it! You’ll be surprised to learn how this one simple action can put you in the driver’s seat of your financial future.
