Debt can come in all forms. There are mortgages, student loans, credit cards, hire purchase agreements and then you may even have outstanding taxes. No wonder the term 'mountain of debt' has become so cliche. Debt can literally start to feel insurmountable before life has really even begun.

Living in the shadow of debt is no fun, so if you would like to become financially free and pay off your debt fast, check out the following tips.

Make a Debt List

This is simply writing down every institution or person you owe money to. You can create a spreadsheet in Excel and include the names, amounts outstanding and also create a column for payments made and a date column so you can track the balances once you start making payments.

Use an Online Debt Reduction Calculator

There are a variety of free debt reduction calculators available for download. This particular calculator uses the snowball approach to debt reduction. It comes with two Excel sheets; the first is a simple worksheet to enter your payment schedule and get a summary of the results and the second is designed to print to keep track of payments made and observe how the snowball effect is drastically reducing your outstanding debt.

Make Bi-Weekly Payments

This is a smart and painless way of making one extra payment a year. The strategy involves splitting a monthly payment into 2 equal bi-weekly payments. Because there are 52 weeks in a year, you end up making 26 payments which is the same as 13 monthly payments. This is popular for reducing mortgage terms without feeling the pinch of saving towards making an extra installment.

Round-Up Installments

Simply rounding-up your installment to the nearest hundred dollars can eat away at your outstanding balance. The excess cash probably would not be missed and it will instead count towards paying off debt instead of being spent on something frivolous.

Identify Ways to Cut Expenses

In order to pay more towards debt it is sometimes necessary to make some lifestyle changes. Find ways to cut back on spending either by going generic at the grocery store, clipping coupons or skipping gym memberships and opting for an outdoor exercise plan. There are lots of creative ways to save and then channel the excess cash into debt payments.

Earn Extra Income

In addition to cutting back on living expenses, you can increase your take home income. Get a second job for a few nights a week or start a home business on the side to bring in some extra cash; then funnel the money into your debt reduction plan.

Stop Using Credit

Obviously continuing to use credit and then subsequently falling behind on making full payments is self-defeating if you are trying to pay off debt fast. Try switching to a cash only policy for the duration of your exercise and see how it feels to really live within your means.

Paying off debt requires discipline, commitment and hard work, but the end result is truly amazing.

Learn more about this author, Natalia Jones.
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