By: kjmena

Overcoming financial debt is no easy feat, but can actually be accomplished with keeping a few key principles in mind. When learning how to pay off debt and save money, you don’t actually have to look for for inspiration. In fact, interacting with my 4-year old every day has given me plenty of fresh perspective on managing money. For an effective debt repayment plan, take a few tips from my preschooler.

A side hustle helps you clear debt faster

The easiest way to eliminate debt is to make extra payments on your outstanding bills. Obviously, my 4-year old is not in debt. He is, however, a collector and after receiving a few dinosaurs from the same set as gifts, he desperately wanted the last one. With no holidays in sight, my husband and I decided to let him do some chores to save up for the missing triceratops. From picking up gumballs in the yard to washing the windows, he diligently earned $1 to put in his savings jar for every chore he did. In just a couple of weeks, he had enough cash to pay for that new triceratops. If you’re searching for a new debt reduction strategy, think about creative services you can offer to earn a little extra income or pick up an extra shift job once a week to help with credit debt. A small side hustle can decrease your bad debt quickly when you put the extra money directly towards your debt reduction plan.

$20 is a lot of money

Whether you are paying off debt or saving money, every little bit counts. A few months after completing his dinosaur collection, my 4-year old requested his very first video game, Skylanders. We found the a game, a portal, and some action figures on Craigslist and talked the seller down to $20. When I told my son how much he had to save up this time, he loudly exclaimed with horror in his voice, “$20!?!? That’s a lot!!!” Yes, it is a lot of money! When struggling with debt, you don’t have the luxury of spending $20 here on McDonald’s, and another $20 on gas station snacks. Think about how much you had to work to earn $20 or even $100 and remember how quickly that adds up when paying down debt or saving.

Celebrate small milestones

It doesn’t help to beat yourself up over your debt problems, especially when you have undertaken a credit card debt reduction plan. Even if you have a long way to go before your debt repayment is over, you still need to encourage yourself and appreciate the progress you’ve already made. Here’s another lesson from my 4-year old. With a November 1st birthday, he loves all things Halloween. We read spooky books and dress up in costumes year round. When mid-summer hit, I asked if he wanted to plant a pumpkin patch so we could make our own jack-o-lanterns for Halloween. He eagerly replied yes. But pumpkins don’t grow overnight and it was a long few days while we waited for those plants to sprout. When they finally did, we celebrated our success with ice cream outside. After a few good rain showers, the plants exploded with leaves the size of elephant ears, which was beyond exciting for a preschooler. Now the plant has curling vines and huge orange flowers which we check on every day. While my 4-year old still has to wait another six weeks or so before we have pumpkins ready to pick, we continually track our plants’ progress and celebrate each time we notice something new. Effective debt management plans don’t just have one final goal. Create a list of milestones to celebrate as you reach them, whether it’s paying off your smallest debt or making an extra debt payment.

Don’t be afraid to ask for help

Calling a debt helpline is a great idea if you feel overwhelmed by your debt reduction, or if you are being hounded by calls from debt collectors. It never hurts to ask for help, and an introductory phone call can help you learn about your debt options. Generally, I encourage my 4-year old to do things himself as much as possible, whether it be getting dressed or cleaning up his messes. But when he has tried his best and asks for help, I always give him the support he needs. Likewise, managing credit card debt often requires backup. Qualified debt advisors help you develop a plan for, debt forgiveness, debt elimination, and other ways to get rid of your debts. A little bit of help can help get you on track to debt recovery.

A 4-year old may not always have the best financial judgment; if I listened to everything mine said, my house would be full of dinosaurs and action figures, rather than food and books. However, he does sometimes offer pearls of wisdom that aptly apply to more grown-up matters like personal finance, how to pay debt and save money.