9 Tips to Help You Get Out of Debt and Increase Your Savings

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Statistics show 37% to 39% of residents in El Paso and Albuquerque have debt in collections. Combined, this is roughly 360,000 to 450,000 people. 

Then, with the recent high price of gas, after several months paying extra at the grocery store, your income only goes so far. 

While many debt-elimination tips exist, they often miss the mark on providing practical tools. Getting out of debt isn't a one-size-fits-all solution; it requires personal responsibility and a solid plan.

Talia Stinson wrote:

“For starters, let’s define what it means to 'achieve wealth.’ It’s inclusive of the ability to manage and reduce debt, build a healthy retirement savings, build an emergency fund, stick to a budget, and diversify your income base. It also includes resisting the urge to spend, making savings a priority, and focusing on building assets for future generations.”

Unexpected expenses can derail your financial stability. A car repair, a medical emergency, or an urgent flight can quickly cost $1,000 or more. Without an emergency fund, these events can lead to significant struggle.

Fortunately, building an emergency fund is within reach. Start changing your habits today to prepare for the unexpected.

These tips can help you to start building your emergency fund. It’s better to start changing your habits today to prepare for these unexpected events.

1. Start saving a little at a time. If you put away $25 one month, you should work toward increasing this amount in future months if possible. You should aim for at least $1,000 if you follow the Dave Ramsey method. Once you have that $1,000, you should increase your emergency fund depending on your life, family responsibilities, and other possible expenses.

2. Practice delayed gratification. With all the commercials and ads these days, it’s too easy to buy things now rather than wait. Save for big-ticket purchases so you’re not adding a high-ticket item to your credit card.

3. Save your next bonus or raise. When you get a bonus or raise, save the money. Act like you never received the money and put it into your savings.

Continue to live off the money you were receiving before your pay raise. The extra money can help build up your savings.

4. Find a part-time job and start building up your savings. If you are barely making it and your income covers all of your expenses, you have to increase your income that will come in.

You may have to work another job to add more income to build up your savings.

5. Start selling items you no longer use. You can have a garage sale or sell items online. With the internet, you can sell items on eBay, Amazon, Craigslist, Poshmark, Facebook Marketplace, Etsy, Gazelle, and other websites.

6. Drive passengers on Uber or Lyft during your free time.

7. Make deliveries with Uber Eats, Amazon, DoorDash, and Postmates.

8. Find seasonal work since many companies hire workers during peak seasons such as the Christmas holidays and summer.

9. Create a budget. This is not a money-making tip, but it is a recommendation to help you figure out where your money is going every month. 

Once you have created your emergency fund, look at other ways to create more income. As you witnessed during the pandemic or inflation, one stream of income barely covers your bills.

Having multiple streams of income seems to be the solution. If you get laid off from your job, you need either a large emergency fund or another source of income until you get your financial life in order.