It is a sobering experience when you are trying to pay off your debts while at the same time continuing to grow your emergency fund. It is easy enough to put your emergency fund temporarily on hold but too often than not getting back to a savings program can slip away from you. In the end, you may be less in debt but if an emergency arises it will all be for naught as your decreased debt will simply skyrocket without a sufficient emergency umbrella. The goal in an economically challenging time is to be able to work out a plan to be able to lower your debt while increasing your emergency fund at the same time.
Move Your Credit Card Debt
Unless you have such a horrible credit score that no company will give you a break, look into moving your entire credit card balance to a zero or less than your paying interest bracket. It makes no sense to be shelling out for a fifteen, seventeen even twenty or more interest rate when your emergency fund is making a two percent or so interest. In essence it is costing you money to save and pay off at once. A zero percent credit card, even if it is only for six months to a year will help you get ahead.
Use your Credit Sparingly
The evil cycle of paying off your debt while still creating debt feels like it is an unavoidable necessity. The truth is that if you put away your credit card and paid for a majority of your purchases with cash or debit then it will not be so discouraging when you start to see your debt numbers decrease.
Create Dedicated Income
A few extra hours a week working a second or third job dedicated to your financial strength may be somewhat of an inconvenience but worth the effort. All income from this additional job should be solely used for debt payoff and emergency fund deposits. You will not have to change your lifestyle all that much (except for your allotted time to work) and it will give you a set number to apply to your finances so the light at the end of the tunnel is more accessible.
Visualize
By writing your goal numbers on a piece of paper and putting them in plain sight for you to see every day will keep your mind’s eye visualized. When you are in a shopping situation this number will pop into your head like a stop light making you think twice before buying potentially unneeded items.
All it takes is a little bit of focus and future planning to be able to concentrate on your dual mission. In the long run, when you accomplish your goal you will not only be amazed at your resilience but you will most likely avoid getting into the same situation in the future.
About the Author: Matt Tomasino is a full-time writer with a focus on perosnal finance, health, and education. He is also writes medical coding content for growing career guides.
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