11 Easy Ways to Get Out of Debt Today

April is National Financial Literacy Month. Many Americans are still struggling to get on track with their finances. Consumers are reliant on credit cards as a primary form of payment. However, credit card debt balances are steadily increasing and many consumers are one paycheck away from being homeless.

Many Americans are still recovering from the 2008 recession. Others are nearing bankruptcy, foreclosure, or experiencing a financial crisis.  This has resulted in delays in marriage, starting a family, filing for divorce, and attending or completing a college education. According to Experian credit bureau 73% of American die with an average of $61,554 in debt. There are several reasons Americans are in debt:

Healthcare

• Healthcare costs have increased 113% since 1999 and continue to climb. Premiums are expected to climb another 166% by 2019.
• Medical bills and expenses.

Cost of Living

• Since 2000, the Social Security Cost of Living Adjustment (COLA) has increased benefits 41% while senior expenses have increased 84%. According to SSA.gov, in 2014, 1.5%, in 2015, 1.7%, in 2016, 0%, in 2017, 0.3%.
• Living costs continue to increase for housing, rent, airfare, clothing, tobacco, food, gas and utilities according to usinflationcalculator.com.

·         The sandwich generation who are helping their children and parents financially are getting further in debt.

Children

• College tuition prices increased at a rate higher than inflation for the past 30 years.
• Couples with children or single parents have greater expenses and more debt than those who don’t have children.

·         Debt incurred by parents helping their children or family members who experienced a financial crisis.

What Can Consumers Do To Fix It

Review

• Get a copy of your credit report at least once a year.

Verify

·         Ask for a debt verification to verify you owe the debt.

Plan

·         Setup a payment plan you can afford to pay the debt.

Seek Professional Help

·         If you are able to negotiate or manage your debt on your own contact a credit counseling agency, credit counselor, financial coach, or financial planner for assistance.

Downsize or Downgrade

·         Downsize or downgrade your lifestyle. Reduce spending by 30-50%.   

Income

·         Earn extra income to pay down debt.

Live Like a College Student

While you were in college you did whatever you could to get a meal and make ends meet. That same philosophy can be applied to reduce your monthly expenses.

Pay More

• Pay more than the minimum monthly payment.

Crowd Funding

• Use crowd funding websites to raise money to pay down your debt such as Prosper, IndieGoGo and Kickstarter.

Valuable

·         Sell something online at Amazon, Etsy or eBay you believe is valuable such as: jewelry, art, furs, etc. and use that money to pay down debt.

Voluntary Simplicity Movement

• Buy nothing new other than food and basic necessities - donate existing possessions to charity. Focus on being needs versus wants.