When you are in debt, one of the things that you have to attend to is growing your debt payment fund. If you want to get out of debt immediately, you want to grow your means to pay it off. The bigger the amount that you can contribute every month, the faster you can achieve debt freedom. This particular act is applicable across all debt relief options – even for balance transfer.
This type of debt consolidation involves getting a new card that will provide a zero interest promo period. This timeframe usually lasts between 6 months to a year. During this time, every payment made will be towards the principal amount – no interest. Of course, there is a balance transfer fee – which is about 3% of the debt that will be transferred. But beyond that, all other payments will be deducted from the principal balance. This will allow you to make a significant cut on your debt – even if it is just for a year.
There are many ways to grow one’s debt payment fund. Let us discuss them one by one.
The fastest way to increase this fund is to cut back on your spending. Start by making a budget and identifying where all your money goes to. Is it going to priority expenses or are you wasting it away on impulsive spending? Make sure that your money goes just where you intend it to. Look at the expenses that you can cut back on. If you have a neighbor who works near your office, why not carpool with them? Or if the mass transit is not much of a hassle, it may be best to ditch your car and utilize the public transport system. Simple changes like cooking instead of eating out will give you savings that when combined, will end up being a significant amount.
While cutting back on your spending will also increase your payments, that will be limited. If you want a bigger increase in your monthly payments, that should involve growing your income. There are many ways to do this but you should try to choose one that will require less effort – at least if your day job is stressful as it is.
A lot of people use their hobbies to earn extra so this may be a path that you can follow. If you can cook really well, why not offer catering services for small gatherings? Or you can bake batches of cookies and other pastries to sell to your friends and colleagues. If there is a weekend market, you can also set up a table to sell your goodies. The same can be applied to carpentry or arts and crafts skills. If you love gardening, offer to take care of your neighbor’s front and back yards. You can do this every weekend.
There are also several online jobs that you can apply to. Freelancing is a strong industry over the Internet. Writing, web development, graphic arts – these are only among the few that you can apply for.
Check out which solution works best for you. If you are intent on using balance transfer, you want to take advantage of that zero interest period. Grow your debt payments and make bigger contributions on your debt. That way, when the promo is over and the high interest kicks back in, you already made a significant reduction on what you owe.