How to Pay a Big Debt

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    • 1). Create a budget. Write down all of your expenses each month, including rent/mortgage, utilities, food, clothing, bill payments, and any other expense you have each month. Then subtract that from your monthly take home income. Whatever you have left over should go to paying off your debt.

    • 2). Cut any unnecessary expenses out of your budget. This means taking your lunch to work instead of eating out everyday, waiting a few weeks longer for new highlights or even shutting off the cable at home. Take all of the extra money you save each month, and put that toward your debt.

    • 3). Sell anything you don't need. You probably have things laying around your house that you don't use but could bring in some cash. Consider holding a garage sale or selling some of those unused items online to make some extra cash. Use all of the proceeds to pay off your debt.

    • 4). Get a second (or third) job. If you work full-time, then getting a part-time job to work nights and weekends can bring in extra money that can go toward the debt.

      If you have a family or can't dedicate your free time to an extra job, then consider using your talents to bring in extra work. Are you talented at making crafts? Consider selling your wares at a local craft show or on a website like Etsy. Or, if you're a talented writer or web designer, then consider creating a website to offer your services. That way you can make money to pay off your debts in the comfort of your own home.

    • 5). Automate your payments. It's easy to forget to mail your payments and unfortunately, this means more money is tacked onto your debt in the form of additional finance charges and late fees. Instead, use your bank's bill payment system to set up automatic payments once (or more) per month. That way it'll always get there, and you won't have to think about it. Just make sure you have the money in your account at the time; otherwise the payment will be rejected, and you'll face overdraft charges from your bank.

    • 6). Gauge your progress. Take a look at your debt balance after a few months of paying all you can toward the debt. You've likely made significant progress in paying off your debt, and this accomplishment will only motivate you to continue paying off your debt.

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