I strongly encourage you to take the first step in getting out of debt. I took this step over 4 years ago and have been debt free (outside of my mortgage) since February, 2011. Having money at the end of the month and being able to pay the bills without worry has been amazing. Can you imagine an ever-increasing bank account hardly trying? One morning you’ll wake up and just happen to notice that you have over $2,000 in your checking account. A few months later this amount will have accidentally grown to $5,000, and then $10,000. You then start to wonder what you should even do with it! Let me tell you though, these are great problems to have.
Take the First Step: Sell Your Possessions
At the point when you really become serious about getting out of debt, you want to see your debt total go down, and fast. Typically, this can’t be done with your normal income because you have stretched yourself too thin (in terms of cash flow) as it is, so in order to get your debt payments rolling you’ll need to sell some stuff – obviously, the more the better.
So what kind of stuff should you get rid of? Truthfully, I would just start out selling anything that has a real value and that others would want. If you have outdoor toys like quads, dirt bikes, or wave runners that you hardly use anymore, start with those. They are in the price category that people can easily afford without getting help from the bank. At the same time though, I would put the big stuff on the market. If you have an extra car or a boat that you can really do without (you have to be honest with yourself here), then put them on the market too.
Listing your items through Craigslist is typically the best way to get rid of them. Your customers are local and can quickly come with cash to make the purchase. Within one day of listing your item you could have cash in your hand and make that big deposit into the bank.
From this point you must move on to step two (yes, I’m going to give away step 2, so listen closely). While it will be very tempting to use that money you just received to buy something else, please DO NOT! This money is first for a small emergency fund of $1,000, and then the rest of it is for putting toward your smallest debts (likely a store credit card or a gas card). Then, once you get a small debt taken care of, you can use that money you had been paying each month to that small debt and put it toward the next largest debt. Then, once that larger debt is paid for, you can take that payment and put it toward the next largest debt. This is called the debt snowball. Once it gets rolling, you can really start to pay off your debts in a hurry!
source: lifeandmyfinances.com
