Millions of jobs have been lost over the course of the coronavirus pandemic, and if yours went away at some point, you may have incurred a fair amount of debt just to stay afloat.
Even if you didn’t lose your job, a lot of people struggled with income loss or added expenses when the pandemic reared its ugly head. And so if you’re sitting on a pile of debt at present, you’re far from alone.
But the last thing you want is for that debt to keep hanging over your head and costing you more money via accrued interest. These tips will help you shed that debt quickly — and move on from the events of the past 15 months.
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1. Get on a tight budget
When you’re trying to pay off debt, every extra dollar you can eke out really helps. That’s why it’s so essential to get on a budget. Once you have your expenses mapped out for you, you’ll have an easier time identifying spending categories that you can cut back in. And the less you spend, the more money you’ll have available to chip away at the amount you owe.
2. Look at getting a side hustle
Your regular job may only pay you enough money to cover your basic expenses, leaving you with little-to-no money left over to tackle your debt pile. The solution? Pick up a side job. There are so many different gigs you can choose from, so think about what your schedule looks like and the type of work that best aligns with your personality.
If you need flexibility on evenings and weekends, a restaurant shift may not be a good choice — but a job doing data entry from home might be perfect. And if you want a side hustle that doesn’t feel like work, you might consider looking into something like dog-walking (assuming you like dogs and exercise).
3. Make your debt less expensive
Lowering the interest rate you pay on your debt can make it easier to eliminate. If you’re carrying a balance on your credit card, see if you can transfer it to a new card with a lower interest rate — or, better yet, a 0% introductory rate. You may also have the option to take out a personal loan, use it to pay down your credit cards, and then repay that loan at a lower interest rate than what your cards charge.
The pandemic impacted a lot of people’s finances, and not in a good way. So if you’re now sitting in debt, don’t beat yourself up. At the same time, it helps to take a proactive approach to shedding that debt so it doesn’t hang over your head any longer than necessary. If you get yourself on a budget, pick up some side work, and find a strategic way to make your debt cost less, you’ll have an easier time moving forward.
Of course, once you’re debt free, it’s a good idea to work on building some savings. That way, the next time a crisis arises (even if it’s not a major one like the pandemic), you won’t be forced into a repeat situation. And the good news? Once your debt is paid off, you can use the above tactic to build some cash reserves and hopefully avoid debt going forward.
View more information: https://www.fool.com/the-ascent/credit-cards/articles/3-tips-for-paying-off-pandemic-debt/