It took me just over a year to completely wipe out my debts, and while that might not seem like a long time to you, it seemed to take forever.
No matter how much debt you have or if you’re finally debt free like I am, you’ll discover that getting out of debt is tough. There’s no easy way out or shortcut to take, and you’ll want to quit more times than you can count.
However, there is one strategy you can use to make it easier or faster – making more money.
As a financial expert, you’re probably expecting me to tell you to cut your lifestyle back, live on rice and beans and be a hermit until your debts are paid.
But I won’t tell you to do that. Granted, I did many of those things and if you’re completely committed to the process, you can be a little radical too.
To be debt free there are only two real strategies that work: cut back on spending or earn more money. And let’s face it, there’s only so much you can cut back on spending until you can’t cut back anymore. Too many people focus on scrimping and saving money and lose sight of how much more progress they could make just by bringing in a little extra money.
Why Making More Money is Crucial
1. You’ll be Debt Free Faster
During the year it took me to pay off my debt, I saw firsthand how increasing my income was directly related to how fast I’d get out of debt and start building wealth. This is why making more money is crucial to getting out of debt, not just cutting your lifestyle.
I started my freelance writing business and dedicated all the income I made strictly towards paying off debt. If I took on more projects and made extra money, I’d make progress that much faster. But if I slacked off and didn’t bring in much cash flow that month, I’d be in debt longer. It’s completely up to you how quickly or slowly you want to pay off your debt.
2. You’ll Have a Higher Chance of Success
The truth is, the longer you work towards a goal, the higher your chance of quitting becomes. You’ll get tired, worn out and start finding excuses to give up. But if you can give you debt payment plan a boost by bringing in more money, your chance of success will greatly increase.
3. You Can Find a Creative Outlet
When you’re keeping a close eye on your budget and throwing every extra cent towards debt, your social life becomes almost non-existent. So you’ve got to turn your new part-time job or side hustle into your social, creative outlet.
One of the things I did was to implement my deal hunting skills at yard sales and thrift stores, then I flip them on eBay or Craigslist for a small profit. This is a great way to meet new people and make connections, while making a little extra money. It makes getting out of debt a little more fun and a little less boring.
4. You’ll Make New Friends
I’ve struggled with debt since I was 20 years old and I’ve tried multiple times to finally be debt free. The only thing that made it stick this time was because I made new friends and found a group of people just like me who were supportive.
When you go out to find a new side job or freelance gig, you’ll come across lots of other people who are doing the same thing. Instead of traveling this debt free journey alone, you’ll be making new friends, sharing stories and encouraging each other along the way. That kind of accountability is extremely important to your success.