Getting out of debt can seem overwhelming at first, but it doesn’t have to be. By following best practices and making smart money decisions, you can quickly set yourself on the right financial path and get debt relief quickly. Here’s what you need to know. 

How to Get Out of Debt 

1. Start a Side Hustle 

If your full-time job isn’t enough to pay your bills and cover your debts, working on the side will help. Consider your skills. Do you know how to design websites? Doing a few on the side will quickly earn you extra cash. If you play the guitar, give lessons before or after work. 

However, you don't want your side hustle to take away from your full-time job. If you end up staying up late to earn extra money but come into work tired every day, you could become less productive and potentially lose your main source of income. The key is to find balance and avoid overworking yourself. 

2. Stay Motivated

Paying off your debt takes hard work, perseverance, and self-discipline, so you need to know why you’re doing it. Do you have a family to support? Are you looking to buy a new home? 

Stay motivated by remembering what your goals are, visualizing yourself debt-free, rewarding yourself at each milestone, and keeping track of your net worth and finances. For example, evaluate your cash flow, check your spending, and review your debt every month. 

3. Create a Budget

Divide up your after-tax income wisely. Many financial experts recommend putting 50% toward your needs, 30% to wants, and 20% to savings and debt repayment. Make sure you’re not spending more than 30% of your gross income on housing, whether you’re renting or paying off a mortgage. If you’re over-spending, move to a new home or look for ways to boost your earnings.

When taking care of debts, avoid making minimum payments. Paying extra money now will help you reduce future interest and the principal. 

While the above tips will be helpful, they won’t always be enough to pay down your debts effectively. The lawyers at Bender & Bender will ensure that you get debt relief and create a better financial future. Serving Wood County, WI, their attorneys will walk you through every step of the bankruptcy process, answering your questions and recommending financial best practices. With over 35 years of experience, their lawyers have helped countless clients get their finances back on track. Visit their website to learn more about their debt relief services, or call (715) 423-4400 to set up a consultation.