When you get married, the huge costs of planning a wedding and starting a new life with someone can cause you to go into debt quite easily. Many couples take out loans, such as online personal
loans, and borrow money from their parents to pay for wedding expenses and living costs until they get on their feet. Paying these debts back can be so hard and for many couples, the source of many arguments and fights is this financial strain. The best way to live your married life in peace is to clear your debt, so here are 15 pointers that will help you become debt free in just a year:
1. Budget, Budget, Budget!
If you don’t have a budget set in place to see what you have to pay and how much money you have, you will ultimately forget to pay certain people and spend more than you make which will land you in trouble. Make a budget and stick to it.
2. Work Out a Payment Plan
With your debtors whether they are parents or a bank, work out how you can pay them back so that you can still live properly. Negotiate lower interest rates and try to pay a bit more than you say you will pay per month to get on their good side. Set aside a percentage of your monthly income to go towards debts.
3. Pay off the Smallest Debts First.
This sounds a bit backwards, but if you try to pay off the bigger debts first you are simply causing the smaller debts to build up interest and they will slowly become unmanageable. Rather pay off the smaller debts you have within a month or two and then with these out of the way you can pay more to the bigger debts you have.
4. Never Close Your Credit Cards
To keep your credit record high enough, don’t close your credit cards. Rather put them away and don’t use them. Once they are paid off just keep them aside without using them until you have cleared the rest of your debts.
5. Consolidate Your Debt
Debt consolidation can only help if you have accounts and loans which are in arrears and you are paying a lot in terms of interest. The point of consolidating this debt is to lower the amount you pay by making several interest costs into one smaller one. It can also greatly reduce the installment you have to pay each month while also getting rid of debt collectors phoning you all the time. For money you have borrowed from family, never use debt consolidation because you don’t have interest to pay them anyway (hopefully). If you do, rather work out another agreement if you are not managing.
6. Pay more than the Installment
This can be easier said than done and if you have a large installment already, paying more than you owe will seem impossible. You should try where you can, especially with the bigger loans, to pay more even if it means sacrificing a night out at a restaurant to get an extra little bit to pay.
7. Cut Down on Your Expenses
Most of the time, people try to pay off their debts while still living the same way. If you really want to be successful in clearing your debt within a year, you will have to relook at your lifestyle and what you spend each month. Avoid expensive payday loan lenders with too high interest. You must try to cut down as much as you can to have extra money for paying accounts and debts. Eat at home more, only go out once a month instead of 4 times, don’t go on shopping sprees and perhaps even find a cheaper place to live, get a cheaper car or get an extra job.
8. Plan Ahead
With debts you have to worry about, the last thing on your mind will be opening health care plans and retirement plans, but all these things should nit be left just because you have debts. You must work extra hard to pay your debts and these policies because they are so important and should not be left. Planning ahead like this will also force you to save more money each month and when you are debt free you will have a lot extra to save or place into these policies.
9. Living Costs
When you have a lot of money to pay back to family or to a bank loan, rather go for a smaller place or flat when you first move in together. It is very easy to say “don’t worry it will be fine” and choose a nice house somewhere with a garden and a pool, but if you have debts and cannot really afford this, then choose a smaller, cheaper place for now. You can always move into a bigger place when you are debt free in a years time and can afford it.
10. Be Self Sufficient
Many people have gone green and started planting their own vegetables and fruits. While this is green and helps you to be healthier and avoid diseases like cancer, it can also save your money a lot and may be a perfect way to clear your debts. By growing your own produce you don’t need to starve yourself or give up eating healthy food because you cannot afford it. This will allow you to eat properly and save lots of money on your grocery bill.
11. Natural Remedies
In the same note you can also look at more natural ways to cure illnesses and help with ailments which are far cheaper than medicines. You can even use natural products as skin care products which will save a lot of money and may actually be safer and healthier for your skin. Things like oatmeal and sage help fight pimples and garlic is the best defense against colds and flu.
One way to get debt free easily is to cut down on so called luxuries like your gym membership. You also don’t want to give in and become unfit and unhealthy, so here is the best solution. Instead of driving your car which costs a lot in gas, rather walk or cycle. This will allow you to cancel your gym membership. So you can cut out on 2 expenses and still get fit and keep trim.
13. Household Items
While you want to have a nice home with all the latest gadgets and furniture, becoming debt free will require that you make some sacrifices. One of the best ways to get some extra cash is to have a yard sale. While many newly married couples do not have much to begin with, there are sometimes lots of old items that come into a marriage that can be sold. Maybe you have some old toys or gifts from ex boyfriends or girlfriends that you can sell, or perhaps you both have furniture already and you need to get rid of the double items. You can sell these items to second hand shops or online to make more money and clear out your home.
14. Shop Mathematically
When you buy food or clothes or anything for your home, make sure you always work out how much you can spend and keep a calculation of this while you are at the shops. In fact to make sure you don’t spend more than you are supposed to, only take the exact amount of cash with you that you have worked out. This will avoid the shock when you reach the till and realize that you have overspent on your groceries. This will also teach you to shop economically too and look for the cheapest items and ones that will also last the longest.
15. Reward Yourself
Like anything in life, when we reward ourselves we are more motivated to continue doing what we have set out to do. The same goes for clearing your debts, and once you have solved your debt problem in one area, give yourself a small reward for doing so well. Then go on to conquer the next debt you have. Good luck on becoming debt free in a year.
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