9 Things You Didn’t Realize You Could Do to Pay off Debt
When the phrase “It’s fun to” comes up in conversation, it’s probably not followed by “pay off credit card debt.”
Paying off debt is associated with living under a rock, eating ramen noodles and cutting the bottom off your toothpaste tube to get the last bit — none of which are very “fun.”
But here’s the thing: Paying off debt doesn’t have to be boring. It doesn’t even mean reverting to listening to concerts from outside the venue and eating your friend’s leftovers from your favorite restaurant.
Here’s How to Pay off Credit Card Debt and Still Have a Life
Achieving freedom from debt just means getting creative with the resources available to you. And we love getting creative. Here are some clever ways to pay off your credit card debt without giving up fun.
1. Search for Unclaimed Money
State treasuries throughout the U.S. have more than $43 billion in unclaimed funds, according to The New York Times. Just sitting around! Waiting for you to come play lost and found.
In 2017, one South Carolina man hit the jackpot. He got a phone call from his state treasurer letting him know he was entitled to $763,000 in unclaimed money. That’s, like, 63 years of rent.
We advise you to be careful of calls like this; they could be scams. But you can take matters into your own hands and see if you have any unclaimed money floating around.
Check with the National Association of Unclaimed Property Administrators. Click your state on the map, and it’ll redirect you to your state’s appropriate search site. (Beware: There are several look-a-like sites out there. Be sure you’re searching legitimate ones.)
Penny Hoarder reader Kelli Howell heeded our advice, performed a quick search, and found unclaimed money in her husband’s name.
“As I was scrolling through, I saw his name and his middle initial,” she says. She asked him to confirm his old Florida address; he grew up in Tampa. Sure enough, Mark Howell was entitled to $56 from a “matured insurance policy.”
Kelli immediately searched her other family members’ names. Her husband was the only who had any money to claim. And, sure, it’s $56, but that’s not bad for an unexpected check, right? We’ll take it!
2. Let This Company Pay Off Your Credit Cards
A lot of us are being crushed by credit card interest rates north of 20%. If you’re in that boat, consolidation and refinancing might be worth a look.
That’s where a company like Fiona can be helpful. It can help you find personalized lending options to refinance or consolidate your debt to potentially save thousands of dollars in interest.
Fiona will show you all the lenders willing to help you pay off your credit card and eliminate the headache of paying bills by allowing you to make one payment each month.
If your credit score is at least 620, you can borrow up to $100,000 (no collateral needed) and compare interest rates, which start at 3.84%. The idea is to secure a loan at a lower interest rate, potentially helping you save thousands. Repayment plans range from 24 to 84 months.
Take, for example, Katherine, who faced $12,000 in credit-card debt. Holding her back? The 15.24% interest rate. By refinancing with a 5%-interest, seven-year personal loan, she saved $12,000 in interest.
If she’d kept on the same road, she would have paid something like $14,000 in interest alone over 25 years. Yikes.
So even if you’re simply curious about what’s out there, know that checking rates on Fiona won’t hurt your credit score — and can probably save you in interest.
3. Use This $720 to Put Towards Your Credit Card Debt
You’re probably overpaying for car insurance. And how would you know, really?
Gabi says it finds an average savings of $720 per year for its customers. Before you spend it all in one place, how about using it to reduce some credit card debt?
Gabi is free to use and you don’t even have to fill out any forms. Simply link your insurance account and provide your driver’s license number, and Gabi will go to work.
Once you link your insurance account to Gabi, it will:
- Scan your existing insurance plan.
- Analyze what coverage you have.
- Compare the major insurers’ rates for that same coverage.
- Help you switch on the spot if it finds you a better rate.
It is a true apples-to-apples comparison at the same coverage levels and deductibles you currently have. Once you sign up, you never have to shop again. Gabi’s software has your policy on file and keeps on monitoring for savings as your life changes.
4. Let This Company Help Create a Payoff Plan
When’s the last time you looked at all your debts and their interest rates to devise a payoff plan?
A really easy way to do this is to get a “credit report card” from Credit Sesame.
Credit Sesame is like your favorite teacher from high school — without the pop quizzes.
It gives you a free credit score, plus lays out your credit history so you can see exactly how much money you owe and to whom. It even tells you your monthly payments and interest rate, as well as which debts (if any) are in collections.
And you don’t have to stay home to do it. The Credit Sesame app lets you keep track of your credit score and ways to improve it — on the go!
James Cooper, a motivational speaker, raised his credit score 277 points using Credit Sesame. Now he talks to high school students about the importance of having good credit and uses what he’s learned through Credit Sesame as a blueprint for his lessons.
Like Cooper, 60% of Credit Sesame members see an increase in their credit score; 50% see at least a 10-point increase, and 20% see at least a 50-point increase after 180 days.*
5. Withdraw Cash From the ATM on Monday
There are always those weeks — the ones where you promise you’ll pack a lunch for work then end up eating out each day.
Now, we’re not saying only eat soggy leftovers all week. But if you have trouble staying on track — whether it’s coffee, lunch, dinner or all the snacks — set yourself a spending limit and take exactly that amount from the ATM on Monday. Then, only spend that throughout the week. Once the cash is gone, it’s back to leftovers.
6. Keep Your Spending Top of Mind to Avoid Racking up More Debt
Out of sight, out of mind, right?
It’s easy to let a sandwich here and a song download there go unnoticed. If seeing your checking account statement each month is a horror story of forgotten debit card charges, we found the app that refuses to let you neglect your finances.
Chime is an online-only bank account that offers some unique features other banks haven’t caught on to yet. Its banking app sends you instant transaction alerts that tell you how much you just spent and your new balance.
No need to log in just to see where your account stands. App notifications let you know with every swipe of the card or automatic withdrawal.
Plus, Chime doesn’t charge overdraft fees, monthly maintenance fees, foreign transaction fees or minimum balance fees. Its mobile app boasts more than 2,000 five-star reviews, making managing money super accessible via iPhone or Android.
Opening an account is free and only takes about five minutes.
7. Lower the Interest Rate On Your Student Loans
For some, a lower interest rate could be one of the best steps to paying off student loans.
Try getting a lower interest rate on your federal and private loans by refinancing with a company like Credible. Other companies offer similar services, but we like that the average Credible user saves about two interest points on their current federal loans.
Refinancing will generally mean replacing your laundry list of loans with one (or a few) loans that bring all of your student debt under one umbrella.
This could simplify your life with one monthly payment, instead of several. It may also lower your monthly payment, improve your interest rate and/or give you more time to pay.
It might seem like a small difference, but a lower interest rate can mean a lot of savings over time. It’s helping grad Ashley Williams save more than $18,000 in interest over the life of her loan.
8. Try Starving and Stacking
Don’t worry. You can still eat. The starve and stack budgeting method is geared toward couples, especially newlyweds. Couples combine their finances and live exclusively off one income for 18 to 24 months.
Use the additional income to invest, establish a rainy day fund and pay off debt. That’s what Penny Hoarder Jen Smith did. She and her husband practiced the starve and stack method for two years and were able to pay off $78,000 in debt.
9. Pay Off Your Credit Cards by Delivering Groceries
Need a reliable side gig? Try delivering groceries, takeout and even retail purchases with Postmates.
The amount you can earn varies, but the median earnings per hour during peak times is $19*, CEO Bastian Lehmann said at a 2015 TechCrunch event.
Unlike other apps, you’ll take home 100% of your earnings when you make a delivery — no service fees, booking fees or transaction fees.
You can deliver through Postmates by car, bicycle or foot. Just create an account, then you’ll receive a welcome kit in the mail within a week (a free delivery bag and a prepaid card to make your purchases). Link the card to the Postmates Fleet app, and you’re off to earning extra money.
*Credit Sesame does not guarantee any of these results, and some may even see a decrease in their credit score. Any score improvement is the result of many factors, including paying bills on time, keeping credit balances low, avoiding unnecessary inquiries, appropriate financial planning and developing better credit habits.