According to a June 2017 Federal Reserve report, Americans now have $1.021 trillion in outstanding revolving credit, otherwise known as credit card debt—the most in United States history. In fact, revolving credit has experienced an annual growth rate of about 4.9%, and with a greater number of consumers, even those with subprime credit scores, being approved for credit cards, it’s likely we will continue to see those numbers rise. But credit card debt isn’t the only storm cloud hanging above the heads of the vast majority of Americans; mortgages, student debt, auto loans, and personal loans account for a huge portion of the debt burden in the United States as well.

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With a large percentage of Americans living paycheck to paycheck, what feels like a manageable amount of debt one day can start to feel like drowning in the space of one small crisis. If you are suddenly realizing that you’ve bitten off more than you can chew in terms of who you owe, the good news is that there are plenty of options available to help you start chipping away at the debt you’ve created and save money by managing your debt more effectively.

  1. Understand your spending. It’s not possible to balance your budget if you don’t know where your money is really going. You’d be surprised how many people not only don’t realize just how much they spend and where they spend their money, but also don’t have a real sense of how great their debt burden has become. Start the process of managing your debt more effectively by sitting down to make a list of every single expense you have and start tracking everything you spend a dime on. Then compare that list to an honest look at your income (after taxes) and see where you stand. If you don’t have enough money to cover the necessities or have too little money to spend on paying off the debt you’ve accrued, you’re going to have to get creative in your approach to paying off all those credit cards.
  2. Get a side hustle. If you sat down to see just how much money is coming in and going out and you didn’t like what you saw, it may be time to consider a side hustle or second job to gain some momentum toward paying off your debt. Getting another part-time job or finding ways to make extra cash on the side using your creative talents will be a great reminder of just how hard you have to work for every dollar you spend, and there’s nothing like donating blood or plasma for cash or finding places to answer questions for money to bring a little humility back into your life.
  3. Lower expenses. Now that you’re being truly budget-minded, it’s time to start thinking about what expenses can be dropped from the expenditures list. Cut back on entertainment spending, like going out to eat, registering for Netflix, or even having cable. Cancel any gym memberships, clubs, subscriptions, or other paid services that aren’t absolutely integral to your everyday life. Investigate your spending and be sure you’re not overspending on the best satellite internet provider, television provider, or streaming service. Get creative in finding ways to lower fixed expenses, like installing energy efficient light bulbs and being conscious of water, gas, and electricity consumption.
  4. Snowball your debt. Debt advisor and media personality Dave Ramsey is known for his recommendation of “snowballing debt,” in which you pay off the lowest balance of debt first, then apply those payments to the next lowest balance once the first is paid off, and so on. This strategy can be super motivating, since you get to see debt disappear quickly when you focus on the smallest bills. An alternative or alteration of the “snowball” method is to try to attack the highest interest rates first to reduce the amount of unnecessary interest spending in the process of paying down debt. Either plan can work, but striking a balance between the two (the “avalanche method”) can often be the most effective method. You might, for example, take the extra money you save each month by paying off a snowball balance and applying it to the card with the highest interest rate instead of the next smallest balance.
  5. Transfer high-interest debt. Another great solution to high-interest credit card debt is to consider a 0% introductory APR balance transfer card. This could be the quickest route to financial freedom, since it’s much easier to make a dent in what you owe when you aren’t paying hundreds of dollars in interest every month. This process involves shifting high-interest credit card balances onto new lines of credit with better terms, and it can work like a charm—but only if you make sure to pay off the debt in the promotional period.

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If you’re ready to reclaim your freedom and unburden yourself from the heavy weight of unmanageable debt, start implementing these strategies to start reducing the amount of money you owe and eliminating your debt once and for all.