Get Out of Debt In Barrie, ON

August 14, 2018 | Posted by: Della Dwyer - Your Trusted Barrie and Surrounding areas Mortgage Broker

Getting out from under debt in Barrie can feel like a huge undertaking. You may feel like you can never catch your breath financially. You may feel guilt, wondering how you got yourself into this financial mess in the first place. You may feel enslaved to your job and money, just to pay off those loans.

Getting out of debt is your key to financial freedom. You will have more career choices, you won't be bound to your job, and you will actually be able to grow your savings and invest. In order to make the most of all of those things over the course of your lifetime, you need to get out of debt as soon as possible. Here´s how to systematically attack your debt to pay it off as quickly as you can.

Step One: Live Below Your Means 

If your living expenses are close to equal (or more than equal) to what you bring home every month, you need to cut back. This is the most painful part of the process.
 

This might mean moving home with your parents. It might mean living in a different place. It definitely means eating out less and abstaining from buying anything new.

There are plenty of ways to decrease your cost of living. Remember, you are going to live like a Spartan for now, but the more sparsely you live, the sooner you can get out of debt. There are plenty of ways to enjoy life without money. Transition to a life with minimal spending.

Step Two: Assess Your Budget

Now that you are living on less, you hopefully have a few extra dollars coming in that you are not spending. If you find this is not the case, you need to address your income situation. Ask for a raise. Get a better job. Get a second job.

Do whatever you have to do to increase your monthly take home pay. If you work days, see if you can get some shift work for a few nights a week. You don't need to exhaust yourself, but you will reach your goals faster by increasing your income.

Once you calculate the difference between your monthly income and your monthly living expenses, assign this money to attack your debt. You may be tempted to reward yourself for all your hard work, but remember that your goal is to get out of debt as soon as possible. The longer you take to pay, the more interest you pay in the long run, the longer you wait to start saving. You will ultimately benefit by cutting back now.

Step Three: Organize your Debts

Which one of your debts has the highest interest rate? Attack that one first. The sooner you pay it off, the less interest you will pay in the long run on your bulk debt. From your debt repayment fund, subtract all money necessary to meet the minimum payments on your other debts, than throw as much money as possible at the highest interest debt.

Once you have completely paid off the highest interest debt, move on to the next one. Use the same strategy, paying the minimum payments on your other debts and using the majority of the money to pay off the bulk loan.

This is the fastest method to get out of a debt and decrease the amount of long-term interest you pay. You will be surprised at how quickly you can get out of debt if you manage your multiple accounts smartly.

Consider consolidating your debt into a lower interest rate loan.  This will help you pay down your debt and increase your monthly cash flow.  Talk to Della Dwyer, Mortgage Broker in Barrie, Ontario, an expert in Debt Consolidation.

Getting out of massive debt (the meaning of 'massive' might vary from person to person) is a huge undertaking, but it can be done. The first step is to live below your means. After your debt is repaid, you may be surprised at how enjoyable life is when you live on less. Once you use your extra income to attack your debt, you will have a frugal lifestyle set up to start saving money, ensuring that you will never have to go into debt again.  Have questions about debt consolidation?  Contact us today!

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