How to Pay off $1,000 of Debt in One Month

Oct 18 | Money Saving Tips, Budgeting, Frugal Living

Do you have a lot of debt? Want to get it paid off? You can get serious about paying off debt. In fact, you can pay as much off as you want. Starting with $1,000 in just one month. It may sound crazy, but lots of people have done this and so can you.

How to Pay off $1,000 of Debt in One Month

Only Keep $1,000 in Savings, Use the Rest

Unless you are planning a big purchase, where you will need a hefty down payment, there is no reason to leave thousands of dollars sitting in a savings account. The average savings account yields very little interest. One $1,000 creates a pretty comfortable safety net in case of emergencies. Any extra money that remains would be best spent chipping away at your debt.

Sell Expensive Items in Your Home

How many TVs do you have in your household? Two, three, or even four? Chances are that they don’t all get used, frequently, if at all. So, why hang onto all of them? Sell the ones that don’t get much use and put the profit towards one of your bills. Do you have a piano or organ collecting dust in the spare room?

The money you could make from selling it will get more use by hacking away at your bills, than if you were to keep it. Look around. We all have items sitting in our homes that are used so rarely, they are often forgotten about. If it doesn’t have much value to you, list it for sale and see what you can get out of it.

Stop Using Credit Cards

Credit cards can be useful in an emergency. However, if you are using them for everyday groceries and shopping sprees at your local mall, then you will likely be finding yourself getting deeper in the hole. Credit cards are borrowed money. Generally, borrowed money doesn’t come free. When it comes to credit card companies, they intend on you paying just the minimum amount back, so they can hit you with interest.

This is how they make their money. Just remember that each time you use your credit card, you are really paying more than the retail price of your purchases, by the time you add in the interest. Even when used in an emergency, you are still going to be paying interest. It is best to build up your savings, so that you don’t have to pay more than asking price for anything.

Make as Many Payments as You can in One Month

Credit reports don’t show how many payments you make in one month, but they do note how much you have paid, total. If you find yourself having leftover money at the end of the week, make a payment. These payments will accumulate throughout the month, bringing down your total debt faster. Doing so, will also make sure that your money goes somewhere important and doesn’t accidentally get spent on a random purchase.

Tighten Up Your Budget in Every Other Area

Cable is one of the most common cuts that people make in their budget. Many people replace cable or satellite tv with much cheaper options, such as Netflix. Eight to ten dollars for either really doesn’t sound like much, but it adds up. Every little bit counts and by getting rid of Netflix, you will also have more time to focus on more important things in your life. It’s not just TV though. What about the fast food that you may be eating frequently? Meal prepping has become quite popular.

Using these tips are great ways to pay off $1,000 of debt in one month. When you really look into your budget, you may be surprised at how much money you’re really spending.

What is your number one tip for paying off debt?