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Breaking the Millennial Cycle of Debt

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Breaking the Millennial Cycle of Debt

An NBC News/GenForward survey released earlier this year found that about three of every four U.S. millennials, those who are 18 to 34 years old, have some form of debt. One quarter of them are more than $30,000 in debt, while 11 percent are over $100,000 in debt, and just 22 percent of this group is debt free..

Millennials have been struggling, entering one of the worst job markets in recent history while also carrying “unprecedented levels of debt,” TIME magazine reports. Due to being laden in debt, they’ve been putting off milestones like calling that realtor in Dallas to invest in a home, or even getting married and having children.

How can millennials break that cycle of debt?
Come Up With a Plan to Pay Off That Debt

If your debt is so out of control that you get anxiety just looking at the numbers, your first step is to force yourself to take a serious look at it. Figure out exactly how much you owe and come up with a plan to pay it off. Ignoring it is only going to make it worse.
Reduce Interest

Of course, if you could easily come up with a plan, you probably would have done so already, right? Here’s one thing you can do that will make a significant difference: reduce all that interest you’re paying. Look into offers for transferring credit card balances with high interest rates to one that offers a special no-interest rate for a certain period of time – just aim to pay it off before the higher rate kicks in. You can also try calling your credit card companies and haggling the rate down – any reduction in interest is going to go a long way in helping you pay it off quicker.
Look For More Income

There are all sorts of ways you can earn extra income, outside of working at a fast food joint. If you have certain skills that can be freelanced, consider doing that during your off-work hours. Or, you might offer tutoring services, dog walking, tech assistance and so on. That’s all income you wouldn’t have had before, allowing you to put all or most toward that mountain of debt.
Write Down Everything You Spend

If you tend to overspend, keeping track of every dollar is a great way to rein it in. Write down, or use an app, every time you spend money on anything, even if it’s just for a cup of coffee. After a week of doing this regularly, review and look for ways you can cut back. Remember, it’s easier to save the money you already have then to earn more.
Cut the Subscriptions

When thinking about everything you spend, did you remember all those subscriptions? While $9.99 or $14.99 a month may not seem like much to pay for something, those fees can add up quickly. Think about the monthly fees for streaming movies, being a member of a dating site, online greeting cards, storage, and so on. How much are you spending and what can you eliminate? If you aren’t keeping a close eye on your bank and/or credit card statements you may not even remember all the subscriptions you’ve signed up for. The services that bill quarterly are particularly easy to miss. Cancel everything you don’t use – if you find you really miss something, you can always subscribe again later. All that savings can be put toward your debt each month.

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