How to Simplify Your Life to Reduce Your Student DebtOct 26, 2017
It’s hard to imagine feeling very “zen” about a pile of student debt. But the truth is, simplifying your life and finding balance can help you clarify your financial goals and debt reduction.
Get to know your debt
At first, looking your debt in the eye can feel uncomfortable. But the more you learn about it, the better you’ll feel. Once you know the terms of your loan(s), and whether you have other options for easier student loan repayment, the more in control you will feel.
Minimize want, minimize debt
Changing the way you think and feel about money has the potential to increase your financial security. Along the way, it can help you reduce your student debt.
Deciding that you need and want less can translate into spending less and clearing up your student debt sooner. Training your mind to focus less on “things” can be a big emotional relief, too.
Simplify your spending
If you’re spending a lot — using credit cards, loans or a line of credit — you may find you’ve become afraid of your finances. Instead of being in control, you’re always trying to catch up and keep up with debt payments.
You can try a variety of techniques to train yourself to be more intentional about your spending. Think about stripping out the unnecessary clutter by limiting your credit options. Ask yourself if you really need more than one or two credit cards. Is debt consolidation an option?
One method that may help is to limit yourself to cash spending where you can — your grocery budget, entertainment budget, and the like.
Seeing physical money in your hand and making the decision to hand it over to another person tends to make consumers think twice before they spend. Over time, you may find you spend less, and enjoy saving rather than purchasing. That frees up more money to put toward your student loan and other debts.
Not sure how you can make the transition from credit to cash? Read about personal finance blogger Michelle Summerfield’s experience with the cash envelope system budget.
What starts out as an initiative to get student debt relief could transform your financial life. In time, you may also meet your other goals, like emergency savings, retirement investments, or buying property. Reframe your spending behaviour and your way of thinking to wipe out your debt.