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Week 3: Debt
Today’s Easy Financial Task: Find money to pay down your debt
How to rock this task:
- Take out your Money List from Day 9
- Write down how much money you saved on Day 10
- Decide how much of that monthly savings will go towards your Debt-Pay-Down-Plan
So, let's get started…
As you know, this is Week 3 and we’re tackling your debt. Yesterday, I had you make a list of all your debt and its terms.
All I want you to do today is to use your Money List to figure out how much money you can allocate to pay down your debt each month. Now do you see why a physical budget is so important?
Note: Some of the extra monthly money you found during Day 10 (Reduce Your Spending), should still be earmarked for savings, but some of it should be set aside for debt too. If you have debt, paying it down and saving should happen simultaneously.
Once you've identified how much money each month can go toward debt, don’t do anything yet. I just need you to make a note of the amount. Tomorrow I will show you how you’ll use the extra money to activate your Budgetnista Debt-Pay-Down-Plan.
If you couldn't find extra money
There are only two ways to get more money in your budget:
1) Make more
2) Spend less
Only you know what needs to be done. Ask yourself if you have a "make more" or "spend less" problem. You might have a combination of the two.
The solutions are easy to identify and will take some work to apply, but you can do it.
1) Make more:
- Are you due for a raise? Gather physical proof of how much value you add to your company and make an appointment to speak with your boss.
- Look at what you do for a living, or what you have a degree in. In order to maximize your time and money, your side-job should be in a field related to what you already do for a living or went to school for. For example, a teacher may want to work as a tutor. A janitor should seek additional employment as a handyman. Finding extra work in a related field means you will not have to acquire a new skill set and your compensation will most likely be greater due to your experience.
- Work overtime
- Babysit, bake, sell dinners, house sit... be creative.
- Earn cash back from spending where you can. On Day 10, we talked about earning cash back from online shopping through Ebates for FREE. Every small bit helps. Earn money back when you spend on necessities and then use it to chip away at debt. Walmart, Pampers.com, and Amazon are just a few merchants that give cash back through Ebates. If you missed the overview of what Ebates has to offer, go HERE.
2) Spend less
- Go over your Money List line-by-line and commit to making real changes in your spending.
- Call your service providers and ask for a discount. It works!
-Restructure your debt. Consider getting a personal loan to pay off your credit card debt. ONLY do so if your monthly payments will be lower with the loan. Also, try refinancing your private student loan debt. This can help to lower your monthly payments.
Here’s our special Sofi personal loan link: HERE.
If you decide to restructure your private student loan debt with Sofi, make sure to use our special DC link.
Here’s our special Sofi student loan refinance link: HERE.
How much did you decide to allocate for debt? Let me know in the comments below. Tell other Dream Catchers in our LRC Forum.
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You can find me here:
Facebook: The Budgetnista
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What’s the Lisa Rule? If I would not advise Lisa to use a product or service, I won’t advise you to. YOU are my Lisas. I feel protective over you and your financial journey.
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