If you are looking for how to get out of debt without money, this is the right article for you. Many people have become indebted to an unforeseen change in their economy. For example, the loss of a job can greatly affect anyone. These are things that happen, but it is especially complicated when you have unpaid debts and you become less liquid.
If you don’t have the money to pay the debts, the first step is to settle this situation. In short, it is not possible to pay a debt without money. It is not important the optimizations you can make with your capital if you do not have the funds to pay the installments, don’t you think? Therefore, we will first analyze what you can do to improve your financial situation.
HOW TO GET OUT OF DEBT IF I DON’T HAVE MONEY?
Sell everything you don’t need
One of the ways to get additional money is to sell things in your home. Each of us is attached to the things we already have, but look at this from another point of view – these are just things and if you exchange them for money, you can get something much more valuable – a life without debt!
What should you take into account when selling? Sell everything you don’t need to live and things you don’t use to work and earn money. They can be: books, furniture, tablet, laptop, television, jewelry, clothing; everything that has value.
Do not limit the quantity. —Once you are done with the debts, there will come a time when once again, you will begin to accumulate the objects that you like. But now, you have to pay all your debts.
Come on! walk your house looking for the things you can sell. Make a list of them. –Where to sell? –
- You can create an account, on one or more of the websites, dedicated to selling items, for example: eBay, MercadoLibre or OLX, Facebook groups, etc.
- Find places where they buy used items (the ones that are working in your area).
- Also, you can organize a fair or garage sale; At the same time, you can organize a food sale.
Increase your income
If all this is not enough, then you need to increase your income, there is no other option! Are you working 40 hours a week? From now on, you will have to work much more.
Work overtime, ask your boss for extra jobs and your friends if they know about additional activities that are paid. Take a part-time job or an extra job.
Here are some examples of extra work you can consider:
- Pizza delivery man at half time,
- babysitting on weekends,
- write articles paid for on the Internet,
- teach the topics you know,
- prepare and sell meals,
- It is guided by tourists.
You must be proactive, look for new possibilities to make money, because nobody will do it for you. If you live with your partner, then try to get a second job for her too. This means, a lot of sacrifices, less time with the family, and less free time to enjoy. But, making more money is the best way to increase savings and get out of debt.
Create an action plan
The time has come to establish the order to pay your debts. Your objective is to create a plan, which will follow your progress in the fight against your enemy, and on the other hand, it will motivate you to continue later.
There are two main methods: mathematical and emotional.
Mathematical method is based on numbers. First, we pay off debts that have the highest interest rate, and therefore minimize the total amount of interest paid.
From an economic point of view, this is the most optimal method, but it has a big drawback! “It doesn’t take into account our emotions.” This means that we have to maintain discipline and nerves of steel. But in reality this rarely happens when you are in debt. If you have guided your actions only by mathematics, you would not have debts now.
It is the reason, why I am a supporter of the second method. This method focuses on our emotions, rather than mathematics. It’s about sorting debts, from smallest to largest total amount, without worrying about interest rates.
Then we make the minimum payment on all debts except the smallest debt, which is first on your list. To pay off this smaller debt you use all the extra money you can find. Once you deal with the first debt, all the extra money is allocated, to pay off the next debt on your list.
This method is known as, “the snowball method,” and his father is Dave Ramsey, a famous American personal finance guru, who used this method to help thousands of Americans get out of debt.