When my wife and I decided to get out of debt, the first thing we did, after creating a zero-based budget, was to fund a $1000 emergency fund.Â We then put our credit cards in the back of our wallets – and began the real process of paying down our debt.
Open a savings account.Â If you don’t already have a savings account – now’s the time to open one.Â Personally, I’m a big fan of both the Ally Bank Savings Account.Â An online savings account allows for easy access to funds – and easily connects to your local bank for transfers.
Have a garage or yard sale.Â I know it sounds a little old fashioned, but a garage or yard sale is a great way to make a few extra dollars.Â We have a yard sale every year or so – and we usually make between $200 and $500 dollars.Â Plus, it’s a great time to rid yourself of some clutter.
Scrap some stuff.Â A few months ago, I helped a friend carry some old junk metal to the scrap yard.Â I was shocked by how much we made – especially when they gave us a pretty decent amount for an old, broken treadmill.Â You may even have neighbors who will pay you to take their junk – and you can then scrap it.
Remember eBay.Â I was looking at my eBay account the other day – and was shocked to see that I’ve been a member since 1999.Â Wow.Â Back when our kids were younger, I managed to make a decent amount of money selling baby clothes on eBay.Â The selling system on eBay is much more user-friendly than it was years ago – and it’s still a great place to get rid of stuff you don’t need.Â (I know that lots of folks use other sites to list items for sale, but eBay is the only site that I’ve used.)
Find a temporary second job.Â I am married and have three kids, so it’s difficult to find time for extra work.Â However, over the years, I’ve managed to find odd jobs – usually involving work online – to supplement my income.Â In fact, this very site is a supplement to my regular job.Â If getting out of debt is important – finding extra work will be, too.
Scrounge for change.Â This one is actually kinda fun – especially if you have kids.Â My son loves to look for change, around the house, in the van, even in my golf bag.Â Take a few minutes, dig around, remember when you used to be able to put 5 gallons of gas in the tank for 5 dollars worth of quarters, and see what you can find.Â You might surprise yourself.
Return stuff.Â Did you make an impulse buy?Â Then, make an impulse return.Â If you have your receipt and the item is unused, you’ll get your money back.Â Obviously, abide by each store’s return policy – but don’t leave stuff in your closet, with tags, just because you are too lazy to take it back.
Analyze your monthly bills.Â This one is easy.Â Take a look at your monthly cable, satellite, telephone, and cellphone bills.Â Either discontinue service, call for discounts, or change plans.Â Do this often!Â Remember, any monthly savings is deposited in to our savings account.
Create a savings-transfer routine.Â This is critical.Â Do not simply automate your savings – be intentional.Â Once or twice a week, transfer any amount that you have saved into your online savings account.Â Get connected with the process – it will mean more to you.
On several occasions, especially early in our debt reduction process, my wife and I had to use funds from our emergency fund.Â We always took the time, even in the middle of our debt reduction, to rebuild our emergency fund.Â We managed to avoid the use of credit cards – and soon found ourselves debt free.