Most people’s debt reduction stories involve eating at home, slashing cable TV, foregoing vacations, and generally living like paupers.
But not everyone. iHeartBudgets got a big boost to their debt reduction process with an inheritance. That lump sum squashed one set of debts, making the other set of debts easier to pay down.
Sometimes you receive blessings when you least expect them. It was clear that iHeartBudgets had done some planning for financial windfalls and had no doubt as to where to put that “found” money. It’s also testimony to this mindset that they continued to pay down debt after this.
If you’re in consumer debt (car loans, student loans, credit cards, and eventually mortgage debt), paying the debt down in advance of the minimum payments will reduce the interest you pay overall. So, plan to throw at least some of the extra money you receive — gifts, bonuses, second income, and even inheritances — at that debt to pay it down.