The vast majority of us have debt. Whether it’s credit card debt, student loans, or all of the above – the truth is, we’d all rather be out of it. Here are some steps to getting out of debt.
1. Assess your financial situation. Take a long hard look at your finances. Debt, income, recurring bills and interest rates. All of it. This can be tough – realizing how much debt you’ve accumulated (and how quickly it grows), and how little you make in comparison. But it can be awakening and help you envision what you want for yourself.
2. Set financial milestones and goals to achieve. Give yourself a realistic deadline. “I want to pay off all of my student loans by 2030.” Or “I want to get out of credit card debt by 2025.” The ultimate goal is to be debt free, but start small and be realistic with your goals.
3. Devise a plan to reach said goals and milestones. What steps do you need to take? Should you pay off larger sums first? Or should you focus on the higher interest rates? Do some research and consider options like debt consolidation loans and balance transfer cards. Remember that there are credit unions who offer FREE balance transfers so don’t get conned into paying for it. Contact creditors and find out if they can lower your interest rate. It never hurts to ask.
4. Implement the plan. Once you’ve done your research and come up with a feasible plan, put it into action! Cut back on happy hours and shoe sales and focus on paying off debt and building a savings account. It might seem daunting at first, but you’ll thank yourself in the long run.
5. Lastly, reward yourself. Once you’ve accomplished a goal worth celebrating, treat yourself (within reason). If you’ve had to cut back on Starbucks, splurge on a latte. Not only does this feel good, but it’ll help keep you in line throughout the rest of your journey to financial freedom. We need a reward every now and again.
Feel free to contact Fort Worth Community Credit Union‘s Member Information Center at (817)-835-5000 if you have general questions about your finances to help start your debt payoff journey.