Five Strategies To Get Out Of Debt Quickly

Getting out of debt is a goal that a lot of people have, but few people have the skills to accomplish. If you are serious about getting out of debt quickly then there are strategies that you can implement to accomplish this goal. These strategies are based on common sense and personal finance management skills.

Strategy #1 – Get Out of Debt Quickly By Paying Off Your Highest Interest Rates

The best way to get a jump start on getting out of debt is to focus on paying off the credit cards with the highest interest rates first. This is especially important if you have a card that has a 22 percent or higher interest rate. The interest on these cards is eating away at your monthly budget without providing you with any value. By eliminating these debts first you will able to free up a lot of valuable capital that you can use for paying down your other debts.

Strategy #2 – Destroy Your Credit Cards but Don’t Close the Accounts

If you are serious about getting out of debt then you need to stop using your credit cards now. Cut up all of your cards so you won't be tempted to add more debt to your accounts. However, you don't want to close your charge accounts as this can actually hurt your credit score.

Strategy #3 – Develop a Strategy to Live Within Your Means

To make getting out of debt easier you want to do everything in your power to stop adding to your debt balance. Since you have already gotten rid of your credit cards your next step will be to create a budget to live on. This budget should allocate funds each month to your basic living expenses. Anything that is left over should be applied to paying off your debt.

Strategy #4 – Add an Extra Income Source

To pay off your debt as quickly as possible you really should try to find an additional income source that you can use specifically to pay off your debt. This income can come from a second job, from a paper route, from recycling, from babysitting, from a yard sale, etc. This income source will help you to pay off your debt balance faster and it will reduce the overall amount of interest that you will have to pay.

Strategy #5 – Look for Ways to Reduce Your Interest Rate

Interest is what makes debt so difficult to pay off. To help reduce the financial burden created by high interest rates, try to transfer your high interest rate credit card balances to lower rate cards or to cards that are offering special zero percent interest rate promotions. If you own a home then you can take advantage of the lower interest rates offered by debt consolidation loans to pay off all of your unsecured debt.