12 Ways To Kick Your Debt To The Curb

Deciding to pay off all of your credit card debt is a big step. Declaring that you will pay off all of it (almost 30K) in just 12 months is a HUGE step. I knew that when it was decided. And I knew that it would be a challenge. But I really want this to be a success because these monthly minimum payments are almost as much as the monthly apartment rent!

In order to be successful, I’ve made of list of the things that must be done to really attack this credit card debt and ensure that it gets all paid off by the end of 2011. Here’s a list of what I’m doing to kick debt’s butt this year. If you want to join me, maybe you’ll get a few ideas from my list.

1. Track all spending. I created a simple excel spreadsheet with my gf to track all of the monthly spending. There are categories for the spending so that we can make sure we only spend certain amounts on each different thing. The spreadsheet will also make it easy to see when there is extra money. And extra money = more money to pay on credit cards.

2. Use gift cards only on necessities and make an equal payment on credit cards. I detailed this tactic of how I use store gift cards to pay down debt last week. So far, I have spent a $100 grocery gift card and a $25 Amazon.com gift card on household necessities, which means I made an extra $125 payment on the credit cards already!

3. Make a plan. First, I added up all of the credit cards to see how much debt we have. Then we determined how much extra it would take each month to get them paid off by the end of the year. Once we saw that & knew that it was possible, we made a credit card hit list and put it up on the wall. The credit card hit list shows the credit cards in the order we plan to pay them off. We plan on ceremoniously crossing each one off as we pay down the debt. Plus, seeing that list keeps up motivated.

4. Delay any non-necessity expenditures. We have tickets to fly to Italy in March of this year that we bought months ago. The tickets are not refundable *sigh* We’re not going though because it will end up costing around $4,000 total. And right now, it’s better to lose the pre-paid $800 in airline tickets and spend $4,000 paying off credit cards instead of taking the trip. It sucks, but it’s the smart thing to do. *sigh*

5. Work more. For some people, this means getting a second job or working overtime. For me, it just means putting in more hours a day. You see, my primary income is from freelance writing so, to make more money I just put in more writing hours each day.

6. Cancel cable. I haven’t done this yet, but after reading Cancel Cable and Still Watch It All, I’m ready to take the jump. My current cable/internet bill is around $125 and I only have the basic digital cable. If I cancel the able and keep only my high speed internet, it would lower my monthly costs by around $75-$80.

7. Evaluate the phone bills and make changes. We only have cell phones in my household, so we don’t need to cancel a landline. Some of you may want to consider that though. We do each have a cell phone and I’m considering canceling one of those lines. We both work from home and are rarely apart, which means we have no need for two cell phones right now. Making that change will save us around $45 per month.

8. Look for alternative sources of income. If you can string together a few coherent sentences, you can easily make a little extra money each month. Places like Associated Content, HubPages and InfoBarrel [referral link] give you an alternative way  to make extra money. I started doing this years ago and make about $125 a month in revenue share payments. For some ideas, see Pat Flynn’s 13 Alternatives to Writing and Making Money on eHow.

9. Cover drafty windows. The apartment I live in is terrible in terms of drafty windows. How terrible? My electric bill was $202.51 last month and I’ve been keeping the thermostat on just 68 degrees to keep costs down! I bought some plastic sheeting and duct tape and have covered all of the windows to lower the electric bills. Hopefully this will cut down on my heating costs.

10. Lower dining out costs. Cutting dining out frequency is an easy way to lower monthly expenditures so that you can make extra payments on your debt. You can even go a step further and only dine out at places where you can get a coupon. I like to watch Groupon for deals on local restaurants.

11. Sell things you don’t need. Have lots of CDs? Copy them all to your computer and sell them on Amazon Marketplace! I’ve been selling loads of things like that – CDs, DVDs and books. I’m only keeping things that I really love.

12. Stop buying things! I’m putting myself on a buying things diet. Do I really need that pair of jeans? No, not really. This goes for things like grocery shopping too! I’m only buying things that are on the grocery list to cut out impulse buys.

Got any tips to add? Feel free to share them with me!

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