Skip to main content

Taking a look at everything you need to know to help you get back into the black. Great debt reduction advice to help you fix your financial woes.

Debt Reduction Advice

Excessive debt is a crippling problem facing most of America. In fact, the national total consumer debt average is over $90,000. Whether your debt comes from a car, a house, credit cards, medical expenses, loans, or a combination of factors, it can feel completely suffocating.

The question is, what options are there for minimizing your debt? Fortunately, there is a myriad of options. However, aside from winning the lottery, nearly every option requires sacrifice and discipline.

But that doesn't mean it can't be done or that you shouldn't do it. Keep reading for our best, most practical debt reduction advice to find financial freedom.

  1. Examine Your Cash Flow

First, you need to uncover two important details about your debt. What's causing it and how bad is the damage?

First, you need to uncover two important details about your debt. What's causing it and how bad is the damage?

To do this, you'll need to do a little grunt work and dive into your finances. Look through all of your bank statements, credit card statements, and recurring bills/expenses to determine exactly where all of your money is going.

Next, compare your monthly expenses to your income. If you're like nearly 80 percent of the American working population, you're living paycheck to paycheck. But don't worry, we're going to fix that.

  1. Cut Out Unnecessary Expenses

After digging into your finances, you were probably surprised by how much unnecessary spending you do each month. You may have even been a little disgusted with yourself. Don't sweat it, you're not alone.

Scroll to Continue

Recommended Articles

However, this is a good time to wake up and start cutting back. Look to eradicate excess spending by cutting out the following expenses:

  • Unused memberships (gyms, sports clubs, etc.)
  • Subscriptions (magazines, movie channels, excess streaming services, mystery box deliveries, etc.)
  • Eating out
  • Coffee shop coffees
  • Unnecessary shopping
  1. Downsize If Necessary

The best debt reduction advice calls you to make some radical changes to your lifestyle. Cutting out unnecessary expenses is one thing, but imagine how much money you could save each month by downsizing your life.

It may be hard to fathom, but consider downsizing to a smaller house with a less expensive mortgage. You may also want to downgrade to an older car with a smaller loan. While drastic, these changes could save you hundreds of dollars a month that you could put toward debt relief.

  1. Explore Debt Reduction Strategies

Ridding yourself of debt means coming up with a plan. There are several debt reduction strategies. The two most common are the Debt Snowball and the Debt Avalanche.

The Debt Snowball has you put all extra money at the end of the month toward the debt with the smallest total value. Once that one is paid off, you put all your extra funds toward the next smallest debt, and so on until you're debt-free. Each time you pay off a debt, your "snowball" to attack the next debt gets bigger.

The Debt Avalanche uses the same principle of paying debts off one at a time. However, in this method, you work on the debt with the highest interest rate first. Then, work your way down the line attacking the next highest interest rate.

However, there are other tools and tips you can use to pay off debt as well. This includes using consolidation loans and hiring expert help for debt reduction advice. You should always learn more about your options before deciding on a specific course of action.

Looking for More Debt Reduction Advice or Other Valuable Information?

In our economy, we know how important debt reduction advice can be. However, that's not all we have to offer. Be sure to check out some of our other articles before you go!

Josh Sinclair