OK – so you have made your resolutions and set your budget for 2015, now how about looking to try and pay off at least 25% of your debt in the first half of the year? As a part of your budget and financial plan, it is also a good idea to set some goals that you can work towards achieving in the upcoming months. Don’t worry – you can still pay off this debt & still enjoy your life.
By implementing a few simple financial strategies, you can work towards alleviating your debt load by a certain portion. Again, setting a goal of 25% is a good place to start, as it is all about setting realistic goals for yourself. Here is a list of some tips that can help set you up for success during your 2015 financial plan.
1) Check your Credit Report
Number 1 on your list can be to check in on your credit and this can start with ordering your credit report. While it is likely that you already do this each year, figuring out where your credit history stands as you devise your plan for the new year can help influence the specific strategies and changes you may choose to go ahead with at this point in time. As you may already know, you can contact Equifax and TransUnion for a copy of your report.
2) Check on Credit Cards
As it may be likely that you are carrying around one or more credit card, this is as good a time as any to check on the status of your cards.As a part of this plan you will want to check your balances, your interest rates, your rewards and cash back features. There are multiple ways to improve your financial situation through credit card adjustments. Whether you call the company to inquire about reducing your rate, switch to a more suitable credit card, or look at making a larger payment to help offset your charges, either way this can be a good method of re-positioning your credit card debt and working towards your goal of paying off 25% of said debt.
3) Check on your Mortgage
If you are currently carrying around a large mortgage, in order to pay more of this debt off you can examine ways that will allow you to achieve this. If you are able to make an extra payment off of your mortgage, this can really help you make a significant dint in your interest payments – and ultimately help you pay down your mortgage a bit faster. As a home owner, your home loan debt likely keeps your debt level quite high – and you can help yourself out by getting rid of some of this debt by adding this to your plan of attack that will compliment your 25% debt reduction endeavour during the first few months of the new year.
4) Find More Ways to Cut Back
Even though it is also likely that you have already looked for ways to cutback on your expenses, as the new year moves ahead, you can keep your eyes pealed for additional areas to reduce your spending. A good rule of thumb that I have learned is that while there are some purchases we make such as our morning coffee, that does actually make us happy, there may also be many purchases we make that really don’t add anything to our lives. Of course you will have to decide this for yourself, however there are areas you can look to eliminate from your daily, weekly, and monthly spending. Additionally, you can see if you can negotiate your current services, such as cable, internet, your cell phone bill. These are areas where you can perhaps get some discounts that will also free up some extra money each month that you can use to pay off bills. Furthermore, some of these services, you may also in the end find out you don’t need and can reduce your expenses even more.
5) Sell Some Belongings
Lastly, going through your household belongings is a good method of uncovering items you have that you don’t really need. With that being said, these items may still be in good condition and could benefit someone else. Kijiji, ebay, Craiglist – are examples of sites you can list your items on and where you can find interested buyers. In the case of this final point, being able to pay off your debts can also come from earning more money, as well as saving. You can earn some additional money from the sale of some of your belongings and plan to allocate this money to your debt repayment fund.
Consignment stores, also offer opportunities for you to make money on the sale of your gently used clothing, furniture, and so on. These types of stores also present options for purchasing items at a reduced cost – and this can also help you lower your monthly costs.
While your checklist may look somewhat different than this one, by making some changes that can help you shake things up and save some extra money within the first few months of the new Year, you can really carve a path for financial success that can set the tone for the majority or all of 2015. In the beginning it may seem like paying down your debt is never going to happen, however just know that it is possible if you set realistic goals and remain committed to seeing them through.
