When I was deep in debt, I realized that I had to cut back on things. It wasn’t so much that the money I was making wasn’t enough, it just wasn’t enough to pay my expenses and get me out of debt. So I had two options either cut back on expenses or make more money. I decided to do both.
There was no way to cut back a whole lot on my living expenses, although I could have lived in the dark to save on electricity and ate macaroni & cheese morning, noon and night (yuck!). Instead I started to watch my spending habits more closely and created a budget that I could follow without straying to the side of overspending.
I’m not one to eat in restaurants, as I prefer home cooked meals, so that wasn’t a problem for me to eliminate it off my list. I’m sure many who do go to restaurants don’t realize how much could be saved just by cutting back on trips to fast food outlets and dining out in fine restaurants . It is expensive to eat out as it adds up real fast the more often you go.
When I had a mortgage, which I don’t now as am in a rental situation, my interest rate was at a low rate but if that were to change it would have been a significant hardship that could have meant losing the house. I had a high enough mortgage on a big house and with all the upkeep expenses, it made sense to me that I needed to downsize. I sold the house and decided to rent instead. I cut my expenses almost in half by doing this.
Related: 5 Frugal Ways to Save You Money Right Now
When my car died around the time I sold my house, instead of choosing a brand new one, I picked an older year and saved money by doing this. It’s no use spending on a new vehicle, that depreciates as soon as you take it off the car lot, and could mean another debt to pay off if you have to take a car loan to get it. I paid cash for mine and because it wasn’t expensive, it didn’t hurt my pocketbook.
My credit cards and line of credit loan were the cause I was in debt in the first place and I needed to get rid of them – and fast. Since at the time I didn’t have a whole lot of money to make bigger payments and pay them down, I chose to tackle the ones with high interest first. Meaning that I paid larger payments to the higher interest ones and minimum payments to the lower interest ones. This started working and when I could do lump sum payments as I was making more money, it helped even more. Finally I got to the stage where I had control over the debt and eventually got rid of it (yay!).
As for increasing my income, I took on some side hustles. Some of the things I did was sell my collectible items and other things lying around that house, that I really didn’t need, on ebay and kijiji. I also made money online by selling domains and websites, plus through affiliate marketing.
Related: Making Money Experiment #1 – How To Turn 0 Dollars Into $100 Cash
There are a lot of opportunities for making money outside of a regular 9 to 5 (working for an employer never getting anywhere) job. It’s very easy and cheap to start a blog that you can earn money from (like I’m doing) and I recommend it to anyone who wants to make some extra money online.
I still keep my expenses in check and don’t go overboard on spending. The only difference now is I am no longer in debt.
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