Completely paying off your mortgage and being debt free is an amazing feeling to have. The stress reduction enables you to be on a whole other level when it comes to being relaxed and feeling secure about your finances. Something fewer and fewer Australians are these days.
When it comes to really ripping into that debt and paying it off in under 10 years however there is one extra step that, although not very exciting, does do considerable damage if played right.
Earning more money via a second job.
Function Over Form
Too often when discussing any subject most are focused on the exciting. The want to know the easy ideas, the things that everyone talks about. In the case of debt repayment or fast debt repayment these “common” things tend to be:
- Cutting back on your expenses
- Doing crazy things to save money
- Reading motivational tales of others getting out of debt
Now to be clear, you do need to ensure that your expenses and spending is indeed in check. You should by no means be spending more than you earn. Optimally you should be spending roughly 25-40% of what you earn after tax on general expenses like food, clothes etc.
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However once you get your expenses under control it’s better to focus on earning more income rather than cutting back even more expenses. This is because you might invest 10 hours of effort for $200 of income ($20/hour). You could conceivably do this every week for a whole year earning an extra $10,400.
Although working an extra 10 hours every week might be tough, it’s not impossible. Finding an extra $10,000 of expenses to cut back on likely is impossible if you’ve already cut them back pretty much to the bone!
Now when it comes to earning more income many people default straight to online get rich quick schemes, becoming an Uber driver or other equally horrible ideas. However for those that are lacking in experience one of the simplest, quickest and highest paying ways of earning extra income is the simple time for money exchange.
Sign up to a cleaning company and clean someones house or do it under your own name/business. Become a handy man and fix odds and ends. Build, install or repair computer equipment. You can do any of these for your friends and family or simply advertise your services locally on Google etc.
As mentioned, these suggested “normal” jobs aren’t crazy ideas or things that will make you a millionaire overnight. They’re frankly boring to talk about I get it! What they will do though is get you money immediately and a decent amount of it too.
You could go read motivational stories of how others have started their own Etsy business and after 10 years of building up their own side gig are now millionaires. The truth is that years of hard work and building really isn’t ultimately needed to just get out of debt.
A Simple Plan For Extra Cash
The services industry (house cleaning, walking dogs, fixing house problems, mowing lawns etc) is a huge area where your time can be quickly and consistently exchanged for money. Sit down and think about what your skills are. Maybe you are an efficient cleaner, maybe you know computers and networking, maybe you love walking dogs. Whatever it is pick one and seek out your first customer or join another business that can find work for you.
An easy way to tell if your have a skill people want is to simply see if there’s anything all your family and friends always ask your opinion on or help with. Are you the one they call if their laptop isn’t working? Do you constantly get asked about nutrition or exercise? Maybe you could start providing diet or exercise guidance at an hourly rate.
Do make sure you’re abiding by any legal requirements before you start as many things like finance or even fitness need special certifications before you’re allowed to give formal guidance.
The key point though is that you don’t have to be doing something magical, exciting or ground breaking to earn a useful amount of extra income. Earning $25/hour to walk a dog, $125 to clean a 3 bedroom house or even $75/hour to fix someones virus infested laptop will all get the job done.
That job is to earn a reasonable bit of extra cash to hit your mortgage with. How much is reasonable? I would first aim to hit ~$200 per week as this has the fantastic result of slicing up to 15 years off your mortgage.
It may not be the most glamorous way to “pay off your debt faster” but it will definitely get you legitimate, real results. Which ultimately is what it’s all about.
Do you already have a well earning side gig? Let us know in the comments what you do, how much it earns you and how it’s helped you pay down your debt.
The benefits include: 1) How to pay off your mortgage faster than 99% of people with one hour a month of work 2) How to get rid of your debt and have the freedom to spend money on the things you love, guilt free 3) Clear outline of how to setup your expenses, mortgage and general finance 4) How offset accounts work and how to get the same result without being gouged by the big banks 5) How to cut through the crap and focus on the things that truly matter when taking down a mortgage 6) How to adjust the strategy so it works for you, even if you have kids, even if you only have one income 7) How to do all of these things and maintain a normal social life (and never be cheap).