Full disclosure: it took me a fair bit of time to connect with what it meant to carry debt. Having taken on close to $30,000 in student loan debt I knew I owed a substantial amount, I knew it was a monthly frustration, but it almost became an expected and normal part of my life.
It wasn't that I enjoyed paying paying bills or interest – that part was fun. But automatically paying bills didn't hold the same weight as finally coming to terms with what debt meant for my financial future. Debt wasn't just representative of money owed, but also financial opportunities lost. Retirement, investing, financial freedom… you know, all the biggies in personal finance. It was only when I realized what I was missing out on by paying into my debt each month that I was truly ready to set a plan into motion. I wanted my financial life back!
Debt doesn't have to be the norm in your life. If you're ready to get out of debt and need an extra boost, here are 12 ways to jumpstart your repayment:
1. Make peace with your debt
First things first – as much as we might want it to, debt doesn't disappear. It's a tenacious resident that only gets worse if ignored. It can be tough to face your finances head on but knowledge is also empowering. When you hold an honest and informed view of your personal finances you can be more strategic in the way that you approach balancing them. It's totally OK to think that your debt is a bummer – but after that, you have to push yourself to ask, "So what am I going to do about it?"
2. Create a plan of action
Take control of your debt repayment by creating a plan that you've set rather than simply following the suggestions of your bank or lender. Though these institutions aren't exactly out to get you, they still benefit from interest payments. In this way, they aren't generally the first ones to encourage you onto the fast track out of debt. Minimum payments are geared towards keeping you in debt. Taking control of your repayment plan and creating something that works for you rather than against you will give you authority over your finances.
3. Achieve an early win
An early win can be as small as funneling an extra 20 dollars into your debt repayment or successfully avoiding an impulse purchase. It's not necessarily the monetary aspect that's most important – it's the knowledge that you do have a say over your personal finances. Small victories are just as important as the end goal!
4. Identify spending vacuums and work to restructure
Take a look at your spending habits. Take note of where you can adjust to save more or to spend less. Unpacking your habits and pinpointing where there's room for improvement or change will help you to understand where to place your focus. Once you have a clear idea of the foundation you're working with, you have insight into how you can fortify that structure.
5. Write down your accomplishments
There's a huge value in writing down your daily financial "wins". Not only will it help you keep track of something positive in your debt repayment, these wins can show you the bright spots of your financial plan. Drawing patterns between positive actions and the results they achieve gives you powerful information that you can expound on.
6. Share with your friends
There's something incredibly powerful about accountability. Sharing your progress with friends illustrates that you're not alone. Accountability can also help you feel as if others have a stake in your success. If they have similar financial goals, they can also benefit from the accountability as well. Nothing like a little bit of social pressure to keep your head in the repayment game!
7. Find your best learning medium
We all learn in different ways – which is why it's so important to identify exactly what mode you respond to best in your repayment. Are you visual? Do you respond to a rewards system? Do spreadsheets make you cringe or nerd out?
Following personal finance bloggers can help you to see that not all people approach personal finances in the same way. Browse around to find some of your faves and you'll be exposed to a supportive community that supports to your learning style!
8. Set up biweekly payments
By utilizing bi-weekly payments you give yourself an extra payment within the calendar year. This shaves off time and interest on your loan repayment. The best part? It doesn't require much more energy than simply creating a new payment schedule.Punching in the numbers will show you the powerful impact of switching up your repayment schedule and automating these bi-weekly payments will take the work off your plate.
9. Incrementally increase payments
Increasing your payments doesn't mean you have to triple them in a single day. Sometimes, you only have a single, lonely dollar bill left over at the end of the month. Put it towards your repayment anyway. Though it might not seem like much in the beginning these small adjustments make a difference! You can raise your monthly payments over time with small incremental increases.
10. Funnel windfalls into your debt repayment
Consider windfalls as a raise – and use that financial advantage to gain even more control over your repayment. It's tempting to think of large sums of cash as "extra" spending cushions but they represent amazing opportunities to help speed up your debt repayment or build a savings buffer in your bank account. If you can resist the temptation to spend, you'll have an incredible opportunity to hack away at the principal balance and cut down on the overall interest costs of the loan.
11. Pick up side income
As mentioned above, any extra cash that you can spare towards your repayment will have an impact! If you're still struggling to find ways to cut back on saving then boost your earnings by picking up a small job here or there. There's no shortage of opportunities and many don't require a long-term time commitment!
Worrying about your finances can be stressful enough without having to worry about missing a payment when life gets busy. If you can automate your repayment then you can free up your time and attention for other parts of your life that may aid you in your debt repayment. Automating your payments, your credit monitoring, etc. will all help you to take control of your finances without having to expend extra energy in the process.
Debt repayment isn't about being perfect all the time! Seize opportunities to excel in different financial corners instead of focusing on past errors. Implementing a new tactic could be the very thing that helps you take control of your repayment and kick debt to the curb even faster!
Claire Murdough is a personal finance writer for ReadyForZero, a company focused on helping people pay off debt. She is a Bay Area native with an affinity for travel and food who enjoys writing about how to get out of debt and many other topics. You can keep up with her on Twitter @ReadyForZero.