The Collection Advisor

7 Surprising Money Sources for Paying Off Debt

Posted by Brian Summerfelt on Feb 14, 2017 9:24:27 AM

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Life is full of surprises, isn’t it?

And the troublesome financial ones seem to strike at the least opportune time. That’s what Murphy’s Law is all about.

So when you are desperately short of money, solutions are not always close at hand. At my collection agency, we often find ourselves actively brainstorming alongside the people we call, trying to find creative ways they can pay off debt and begin restoring their credit.

Oftentimes they are surprised at how many money sources are available to help them out of debt, when on the surface it seemed all doors were welded shut. 

Here are some of the most helpful places to find the money you need to pay off debt:

1. Income Tax Refunds
At tax time, many Canadians discover they have unexpected money coming their way. Instead of spending your tax refund on a night out or a new item of clothing, use it to pay off high-priority debt. Start with debt owing to a collection agency (where it impacts your credit rating directly) and then move into your highest-interest credit cards or loans. Instead of spending the money on short-term enjoyment, you are investing in a better future. Here is some great further reading on how to make best use of your tax refund.

2. Selling Off Excess Baggage
Got some power tools you never use or duplicate small appliances you received as wedding gifts? Post them on a peer-to-peer selling website like eBay or Kijiji. Selling your old smartphone or other unused items can be quick and painless – and those technology devices are constantly losing value on the shelf. In addition to the cash, you’ll enjoy a de-cluttered home.

3. Take on a Side Gig
It’s never been easier to make extra money on weekends and evenings. Online services can help you be a part-time nanny, handyman or babysitter. Websites like AskForTask help you to do small, quick jobs for payment. Driving for Uber, TappCar or similar services can be a good additional revenue stream, or even your next job!

4. Rent Your Stuff
A growing number of online services make it easy to rent your own car, cottage, extra room or other in-demand possessions. Check out Airbnb, Turo or Maxloc.

5. Friends and Family
When times get tough, there is often someone willing to help, if you’ll just ask. Family members and friends are often happy to help in a time of need. Remember that you’d do the same for them. 

6. Lines of Credit or Overdraft Protection
If you own a home, it can be easy to get a Home Equity Line of Credit (HELOC), leveraging your investment. Many people can also access (or add) overdraft protection of several thousand dollars on their bank account. Both of these options can usually be available at relatively low interest rates. 

7. Alternative Financing
Once terrain fraught with loan sharks and opportunists, the regulations governing payday loan and other short-term financing providers have made interest rates more reasonable. Services like Mogo and iCash offer a variety of solutions that can be worthwhile for bridging a gap and even rebuilding credit. 

Finding money isn't rocket science: it's about being creative, and more importantly about taking action. None of the above options are going to take care of themselves, so set your sights on those that are most appealing, and invest some effort. Work on more than one to give yourself backup options.  

If you’re having trouble with debt owed to you, use the link below to download my popular debt collection pro tips!

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Topics: Debt Management