When you take a look at consumer debt statistics in the United States, one thing becomes clear: People all across the country are drowning in it. As of June of 2019, the total reported consumer debt had risen to $4.1 trillion. There’s not much you can do to impact debt on a national level, but you can tackle your personal finances with these tips.
Don’t Make Hasty Decisions
When you’re drowning in debt, you may grasp at any lifeline thrown at you. Making hasty decisions can get you into even more trouble, however. Debt consolidation, credit counseling and other too-good-to-be-true offers can turn out to be exactly that. Granted, there are some legitimate offers out there, but many are predatory. Be sure to do plenty of research and run your plans by someone you trust before signing anything.
Stop Sinking Further
The first thing you should do when you’re hemorrhaging cash is to stop the bleeding. Take every measure you can to stop spending more money. Lower your interest rates, cut up your credit cards, only pay with cash and don’t take out more loans, advises NerdWallet.
Cut Back on Expenses
In a similar vein, do all you can to lower your expenses. Stop recurring charges on things you’re not using or that you can do without, such as Netflix and other streaming services and subscriptions. Disconnect services you don’t need to survive (i.e. cable, lawn-care services, and memberships). Seek to lower daily expenses as well. Pack your lunch, forgo your morning coffee — do everything you can to save a buck. It all adds up.
Increase Income
Look for easy ways to increase your income. Entrepreneur recommends driving for Uber or Lyft, selling unwanted items online, selling services on Fiverr or creating YouTube tutorials. There are so many ways to make money in today’s technologically connected world. Learn which options match your schedule and skill set.
Create an Automatic Budget
An automatic budget can help you to stop focusing on your money so much. When you don’t have to think about making purchases, your money will automatically go where it needs to behind the scenes. You may also find that you spend less money. To create an automatic budget, set up recurring payments for all of your bills.
And don’t forget to save part of your paycheck automatically while you’re at it. You can’t get out of debt by continuing to do the things you’ve done in the past. Start saving now to improve your finances in the future.
You don’t have to continue drowning in debt. There is a way out, but you may need to change a few habits. Give these tips a try and see how quickly you can be swimming freely rather than drowning in debt.
~Here’s to Your Success!
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