You may be stressed because you have lots of debt you have no idea how to pay off. The good news is there are solutions. These are seven steps for how to get out of debt.
Seven Steps For How To Get Out Of Debt
List Out All Of Your Debts
Make a list of all the types of debt you currently have. The first step is to face the reality of your debt. It would help if you faced the facts. Once you know the facts and the amount of debt you have, you can work to pay off your debt. You can then come up with a plan to get out of debt.
Start A Rainy Day Fund
Once you know how much you have to pay off your debt, start a rainy day fund. Save at least $1,000 in your rainy day fund before you start to attack your debt. Your rainy day fund will allow you to have the cash to cover emergencies to prevent you from immediately pulling out your credit card to pay for an emergency. This is a simple method to help you from continuing to go into debt.
Your rainy day fund starts as a life jacket. Your rainy day fund can eventually become an anchor to hold you steady in a financial system that wants you to be in debt. Once you pay off your debts, you can build a giant F.U. fund.
Pay Off Your Debt
The first solution is to pay off any debt you may have as soon as possible. You can start by paying off your smallest debts first. You can then start to chip away at your larger debts, bit by bit. You want to start small because you will start to see results sooner. This will help you psychologically to know that you can successfully pay off your debt. You can begin to pay off your debt by following the Spring To Sea Method.
- Make a list of your debts from the smallest to your largest. Don’t worry about the interest rates.
- Plan to make the minimum payments on all of your debts except for your smallest debt.
- Pay as much as you can to pay off your smallest debt.
- You can repeat this method until all of your debts are paid off.
You will start to pay off your smallest debts first. You will eventually be able to pay off your medium and large debts. You can start small by paying off your smallest debts first before paying off your large debts. Begin small, like a small mountain spring that eventually connects to the sea.
Find Ways To Make Extra Income
You can work to find ways to bring in extra income to help you pay off your debt. You could pick up extra hours and work overtime when it is offered. You could pick up a part-time job to supplement your full-time job. You could find random jobs in your area to bring in extra money. You could become a freelancer on a site like Fiverr or Upwork. You could resell anything that you no longer use or need on resell sites like Facebook Marketplace.
Don’t Give Up
Never give up. Debt is common. You are not alone. You can pay off your debts. Your debt is preventing you from reaching other financial goals. You can go from being in adverse financial health to experiencing positive financial well-being. Your mental health will improve once your finances improve.
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Find Ways To Make Passive Income
You can work to find ways to make passive income. Passive income takes longer to generate compared to active income. You could work to write a book. You could create a website or YouTube Channel and eventually make money from advertisements and affiliate marketing. You could start a paid newsletter. You could sell merchandise. You could sell digital products, from music clips to digital courses.
Views expressed in this article are the author’s opinions and do not necessarily reflect the views of Secure Single. It is intended for informational and educational purposes only. It is not investment or financial advice. James Bollen is the author of Thriving Solo: How to Flourish and Live Your Perfect Life (Without A Soulmate). Now available in paperback and for the Kindle on Amazon. Subscribe to Secure Single’s Substack for free!
There are many reasons why millennial women marry later in life. It could be due to the fact that women now, more than ever, have more opportunity in the workforce to create their fortunes. It may also be true that alongside the ambitious women are those with student loan debt. It could be possible that one of the reasons that women work so hard is that they want to make something significant of themselves and they want to be financially free. These are some of the reasons that influence single women remaining single longer and delaying marriage, which is the new trend.
With opportunity knocking at the door and financial freedom around the corner, women have began to blaze down the career path with relentless passion. Student loan debt is on the rise, and so is the cost of living. Women’s rights are also more liberated than ever, thanks to progressive women in history. Women who now have the opportunity to work more in higher and more advanced positions, and make a really good amount of cash flow to lessen and eliminate the burden of student loans.
With our minds preoccupied, marriage and family are far from our minds. It is true that some women want a family and aspire to be good mothers, but it is also true that that is not the only option available for women. Go after what you want. Start that business, work three or more jobs to pay off your debt, learn new skills that make you marketable in the marketplace.
Marriage used to be a union of economic security for women in previous generations, but now that is not the case because Marriage Rates Are Plummeting:
“The median age at first marriage is now 27 for women and 29 for men — up from 20 for women and 23 for men in 1960… Today an unprecedented portion of millennials will remain unmarried through age 40, a recent Urban Institute report predicted. The marriage rate might drop to 70 percent — a figure well below rates for boomers (91 percent),”
What’s more is that having student loan debt does in fact delay marriage. Here are the stats about student loans:
General Student Loan Debt Statistics
- Total Amount of Student Loan Borrowers: 44 million +
- Total Outstanding Student Loan Debt: $1.41 trillion +
- Average Federal Student Loan Default Rate: 11.8%
- Average Number of College Grads with Student loan Debt: 60%
- Average Debt Per Borrower: $27,975
- Average Debt Per Graduate: $16,723
- Average Debt Per Graduate Student: $57,600
- Average Debt Per Borrower at a Public School: $26,828
- Average Debt Per Borrower at a Private School: $30,281
- Department of Education’s Estimated Profit Over Next 10 Years: $127 billion
With student loans as a burden, and an economic climate of opportunity, it’s no wonder that women are taking advantage of having a career oriented life. To pay off your student loan debt and have a career you once could have only dreamed of, you can literally life the life you desire. Career oriented women are smart because they choose to make the most of their time developing into the best version of themselves.
Views expressed in this article are the author’s opinions and do not necessarily reflect the views of Secure Single. It is intended for informational and educational purposes only. It is not investment or financial advice. James Bollen is the author of Thriving Solo: How to Flourish and Live Your Perfect Life (Without A Soulmate). Now available in paperback and for the Kindle on Amazon. Subscribe to Secure Single’s Substack for free!
A Single’s Guide to Budgeting
We’ve all been there, especially if you are a 20-something. You’ve lived with roommates long enough, and you now want to experience living on your own. Or, you’ve just broken up with your significant other and you don’t know what your next steps will be. In a tough job market with sticky wages, how can you afford to rent a place on your own? How you achieve this boils down to your planning and the action of working your plan.
Learn Your Budget
You need to know how much money you are bringing in, and how much money is going out. A lot of people think they have a handle on their money, but when they go to check their bank account, there is nothing in there.
A simple way to start is to get on the computer, whether your own or one at the library, follow these steps to get the ball rolling:
- Create a Gmail account and login to Google Docs.
- Open up Google Sheets and create a file called, ‘Budget.’
- Log into your bank account and import your transactions into Google Sheets. Here is a video on the process.
- Sort your transactions.
- Your first part of the budget will be your income statement. You will want to start making ways to build multiple streams of income.
- The second part of your budget will be your expenses. You want to list your fixed expenses first. Those are your rent, utilities, car and student loan payments.
- The third part of your budget will be your disposable income. This is the money you have left over for food, gas, and entertainment. Most people who are working to get ahead save 10% of their income and put it in an interest earning account. You will want to do your best to save as much as you can, especially at a young age.
- Compare your income versus your expenses. This is called a cash flow statement. If you are in the red, meaning your expenses are greater than your income, then you need to create a plan of action to increase your income and decrease your expenses.
Cut Your Expenses
You may have necessary items you need to pay for monthly, but there are a lot of items you can do without. It may be as simple as canceling your Netflix subscription or lowering your data plan on your phone. You might also want to cut the cord on your cable bill. If you are living with roommates, find a fair way to opt out. Ask your landlord if you can do extra work for free around the rental space to lower your rent. You can also ask for lower rent if you sign a longer lease.
Plan meetings with your friends once a week, versus multiple times a week and on the weekend. You will cut down your ‘eating out and drinking’ expenses. This will give you a little extra money to save while rewarding yourself once a week by allowing yourself to go out. To keep your food expenses low, eat before you go out, order smaller plates, and even stick to one drink – you can pace yourself by drinking slowly, so you will always have a drink in hand. Enjoy going out in moderation by allowing yourself one special night a week. It is necessary to have money in the bank for survival. Saving is a huge key.
Negotiate
One way you can work to cut your expenses is to negotiate lower prices and interest rates. If you have a student loan, shop around and see where you can find the best interest rates. Ask your current provider if they are willing to compete for your business. If you have an internet bill, ask for a smaller rate. See if you can cut your data back for a lower monthly cost.
Energy Bills
In some states, you can sign up for ‘Non-Peak Hours’. Through Xcel Energy, there is a sign up to do your laundry, dishes, and showering between 9 pm and 9 am which are the ‘Non-Peak Hours’. Your kwh usage is literally cut in half. This includes lighting and internet usage during the day. Your energy bill can be cut in half, and this will put more money in your pocket.
Save Money
Depending on your bank, you can set up automatic transfers to save your money for every deposit. Generally, you want to save 10% of everything you own. This comes from ancient scripts.
Related:
- The 50/30/20 Budget For Singles
- 50/30/20 Budget Versus 60/30/10 Budget
- 15 Habits To Build Wealth For Singles
Refinance
If you have student loans, you most likely can consolidate and shop for a lower interest rate. Companies like SoFi and DRB are helping students refinance their loans and get a better rate. To pay down your loans faster, take the extra money you squeeze out of your budget, and put it towards the principal each month.
All steps can help you get out on your own, and to afford a place of your own. It may seem hard to do right now, especially when you are a 20-something with low cash flow, but if you work hard at building additional income, paying down debt, and saving money, but you will be in a much better financial position to take care of yourself. stick to the steps above, you may be in a better financial position. Keep yourself financially literate and up to date on where your money is going. For more information on budgeting and getting out of debt,m check out Dave Ramsey.
The principal is simple: lower your expenses, save money, and work towards making more money to pay down loans. Not only will this help you build up cash reserves for yourself, but it will also allow you to have more money to go towards a single apartment you can rent all by yourself. Being financially independent is possible, plan your work, then work your plan!
Views expressed in this article are the author’s opinions and do not necessarily reflect the views of Secure Single. It is intended for informational and educational purposes only. It is not investment or financial advice. James Bollen is the author of Thriving Solo: How to Flourish and Live Your Perfect Life (Without A Soulmate). Now available in paperback and for the Kindle on Amazon. Subscribe to Secure Single’s Substack for free!
Learning the basics of money and the best practices for anyone, but especially for singles. This is because singles face a tax penalty for being single that society has rationalized as acceptable. There are a few basic questions that you should consider as you start to budget, save, and invest your hard-earned money. These different ways will help to increase your individual net worth over time, which will in return give you more independence and flexibility as a single.
Create A Budget
Budgeting can be difficult to do. At first, you will feel constrained since you may limit the amount that you go out or cannot purchase the latest fashion trend since you created a budget. However, you bank account and wallet (or purse) will thank you. Instead of thinking of budgeting negatively, think of it as an awareness tool that keeps track of your purchasing and spending habits so that you can change the course of your ship towards your destination when you find that your spending or saving is not going in the right direction.
There are two main ways to think about budgeting: long-term and monthly budgeting. Long-term budgeting and planning has a goal in mind. Do you want to budget and save for a house? Do you want to create a well-diversified portfolio? If you are interested in goals along the lines of those questions, then a budgeting tool that you could consider using is Mint. If you are just starting out with budgeting and want keep track of your dialing and monthly spending habits, You Need a Budget is another great resource.
What Are You Worth?
Your net worth is your total worth in the assets that you currently have. These will include savings, investment portfolios, property such as real estate, and any liabilities that you may have such as loans and debts. Make it a point to know your net worth and confront any problems that may be decreasing your overall net worth immediately. Keep track of your net worth. The goal should be to see it rise over time.
Debt
Debt is financial slavery. You will not be able to fully utilize your money and you will be unable to do with your money as you please until you pay off your debt. According to a recent report by the Federal Reserve Bank of New York that Millennials student debt “now compromises 69 percent of the debt side of their balance sheets.” For the Millennial generation, the majority have debt from college loans or from other loans that they decided to take out to pay for something instead of trying to save for the purchase or find other ways to get the money that would not result them being in debt.
Save
The general rule is to save 20% of all of your earned income. This follows the 50/20/30 Rule that says spend 50% of your income on essentials, save 20% of your income, and the final 30% is for personal use in your budget. But depending on what your financial goals are, you may decide to save more and decrease your discretionary monthly budget on nonessentials.
Invest
When you create an investment portfolio the goal should be that it will be diversified to include stocks, bonds, equities, bank notes, savings, etc. There are different options for how you can invest that will depend on your goals and your risk tolerance: conservative, moderate, or aggressive.
The main differences between these three portfolios is the amount of risk that the investor has chosen to accept. As the risk increases, a larger percentage of the portfolio is focused on stocks compared to less risky investments such as security bonds that make up the majority of the conservative portfolio. Depending on the markets and the stocks that were invested in the aggressive portfolio will result in a higher rate of return for an investor over time compared to the moderate and conservative portfolios. However, while the conservative and moderate portfolios will have slower growth compared to an aggressive option they will require less management and following stocks as they rise and fall.
Summary
It is important that singles understand and care about financial planning and all that it entails since this is your money. Money is powerful tool. Singles should value the freedom and adaptability that the single life offers. Singles will increase their independence by working to raise their net worth and pay off any debts that they may have from college. Begin today singles on creating and following a budget, pay off any debts that you be owe, and look into creating an investment portfolio that fits your risk tolerance as well as into your life goals.