Debt is a scary word for a lot of people. It conjures up images of ruthless creditors or calls from bill collectors looking to get paid.

You might have gotten into debt because you spent more money than you earned. Or it may be the result of serious financial hardships like losing a job or divorce.

Regardless of the reason, if you want to get out of debt quickly, it’s essential to look at your debt and finances. Then you can make a plan to pay off your debt to fit your needs.

Our professional advisors have put together some tips to help you focus on paying down your debt quickly. With some planning and discipline, you can get out of debt and get back in control of your finances.

Tips to Get Out of Debt Quickly

1. Review your financials and create a plan

If you want to pay down your debt quickly, you need to find ways to decrease your debt load and avoid taking on new debt.

You can drastically improve your financial situation by creating a plan that helps you allocate more money towards your debt and become more strategic with your debt repayments. If you feel overwhelmed, you can seek help from credit counsellors who can look at your debt situation and create a customized plan that fits your financial needs. 

2. Prioritize high-interest rate debt

Debt can be overwhelming for many people, especially if you are trying to decide between various types of debt with different interest rates. Credit card debt and payday loans charge higher interest rates, and it can be frustrating to make payments when all your money is going towards interest. When you focus on paying down high-interest-rate debt first, you can save money on interest payments overall in the long run.

3. Negotiate lower interest rates with creditors

You can negotiate a lower interest rate directly with your creditors to help you pay down debt faster. Call your creditors and ask to see if they can lower your interest rate. Some creditors might be open to it as it is in their best interest to get paid.

4. Consolidate your debt

If you have multiple debts with high-interest rates, such as credit card debt, and payday loans, you can consider consolidating your debt.

When you consolidate your debt, you can quickly reduce the number of payments each month. You will also save money in the long run and be able to pay down your debt faster.

5. Make more than your minimum payments

For many people, making the minimum payment on their debts is all they can afford. But if you want to get out of debt quickly, you need to start making more than the minimum payments.

Any additional money you can afford to put towards your debt will help reduce the overall interest costs and help you get out of debt quicker.

6. File a Consumer Proposal or Bankruptcy

If you are struggling with debt, consider filing a consumer proposal or bankruptcy. These are formal avenues to reduce the debt you owe.

When you file a consumer proposal, you propose to pay off the debts you owe over time. In some cases, filing a consumer proposal can even reduce your debt load by up to 80%.

Bankruptcies are typically a last resort option, but if you have no other ways to manage your debt, they can be your best bet to get out of debt.

Learn more about bankruptcy and consumer proposals here.

7. Find ways to earn extra income

Another way to get out of debt quickly is to find ways to increase your income. You can do this in many ways.

• Get a higher-paying job if your job is in demand
• Pick up some freelance or part-time work if you have time
• Start a side hustle
• Sell unused belongings that are collecting dust

Every little bit of income you can put towards your debt can speed up the process of paying down your debt.

8. Track your spending

The most meaningful thing you can do when paying down debt is to look at your budget and spending. Your spending can give you a clue as to where your money is going today and help you decide if there are any expenses you can cut back on to pay down your debt.

While you review your spending, look for opportunities to cut back your expenses. Here are some ways to cut back on costs:

• Cancel services and subscriptions you don’t use
• Downgrade your cell phone or internet plan for a little while
• Find coupons to save money on groceries and other essentials.

Even making some temporary changes can help you save a little money and put towards your debt. Once you have repaid your debt, you will have more money to spend on the things you want.

9. Seek Professional Advice

If you struggle with debt or have questions about improving your financial situation, consider seeking professional advice from debt counsellors. Professionals such as credit counsellors can help you understand your options and make a plan to get out of debt quickly.

10. Stick to your plan.

Creating a plan is the first step; sticking to your plan is the most important thing you can do to get out of debt. Whether you find a trusted debt advisor to help you pay down your debt or stay accountable to your plan yourself, you will have to remain disciplined and focused on your end goal. It may be difficult at times, but your financial goals will be within reach if you stay committed to getting out of debt.

Don’t let debt get in your way

If you’re in debt and it affects your daily life, there are many ways to help you pay down your debt faster and take control of your money!

Getting out of debt doesn’t have to be complicated or stressful. With a little discipline and some planning, you can get out of debt quickly and set yourself up for financial success.

If you need help creating a plan and figuring out your best options for debt, our team of professional debt advisors can help. Contact us for a free consultation.