5 Tips For Getting Out of Debt

Paying off your debt as quickly as possible puts you in the catbird seat for landing a new home. However, paying down financial obligations is easier said than done. Even if you were to make on-time payments for several years, there is still a good chance you will be buried in debt. The silver lining is that there are some helpful strategies for paying down debt in a timely manner. Here’s how to do it.

1. Sell Your Home While the Market Is Hot

The quickest way to pay down debt is to sell your home for cash to Beard Bros Buy Houses Cash. We will pay cash for your home, providing you with the money you need to pay off debt and transition to the next chapter of your life. The market is blazing hot at the moment, so selling now is likely to net that much more than would be possible in the months or years ahead. There is a good chance that you will time the market just right by selling now and buying down the line when prices are more reasonable.

2. Pay As Much As You Can Each Month

There is an ongoing debate as to whether it is more financially prudent to pay off debt quickly or to use that money for investing. It is possible that investing the money will spur a return so large that you can pay off a considerable chunk or all of your debt sooner than would otherwise be possible. However, there is also a chance that money poured into investments will not produce a rapid payout. This is precisely why it is better to pay as much as possible toward the debt each month. The quicker you pay, the faster you will be off the hook for these financial liabilities. 

3. Attack High-Interest Debt First

Take some time to lay out all of your debts so you have an opportunity to review each one’s specific interest rate along with the money owed on each account. Though it seems logical to make sizable payments to each creditor on a monthly basis, doing so is not financially prudent. Rather, it is in your financial interest to pay down the debt with the highest interest rate first. 

The exception to this approach is when the debts are of significantly different amounts. If you have the vast majority of your debt locked in at low-interest rates and comparably small debts with a high-interest rate, it might make more sense to pay equal amounts to both simply because the low-interest rate on the massive debt has the potential to equal the accumulated monthly interest of your smaller debts in spite of the fact that they have high-interest rates.

4. Consolidations and Transfers

You can reduce the amount of time it takes to pay down your debt by consolidating it or transferring it to a new account with a lower interest rate. The overarching aim of these approaches is to decrease the interest rate to a lower level to minimize the debt’s growth. In fact, some financial institutions provide a 0% introductory rate. Though transferring debt to a new account might trigger a fee, doing so will reduce the rate at which the balance grows, helping you get out of debt as quickly as possible.

5. Spend Less

Spending less of your discretionary income does not mean you have to live like a pauper. Invest a little bit of time analyzing your monthly budget to determine where the metaphorical financial fat can be trimmed. Minimize your spending on luxuries and other nonnecessities, redirect that money toward your financial obligations, and it will be that much easier to climb out of debt as quickly as possible. Alternatively, if the idea of spending less isn’t that appealing, consider picking up a side gig and using the income from this part-time job to pay down your debt in the months ahead rather than letting it continue to increase as interest expands the amount owed with each passing day. 

Contact Beard Bros Buy Houses Cash Today

Our Omaha home buying team will make an all-cash offer for your home. An all-cash sale sets the stage for you to pay down your debt and make a timely transition to new digs. Sell now while the market is still hot by reaching out to us at 402-810-8091. You can also contact us online by completing our contact form.