Is a mountain of credit card and loan debt standing between you and your fortress of financial strength? Consider these six tips to turn that mountain into an ant hill:
- Use Your Budget: Once you’ve monitored your monthly spending habits, assessed your average income, and tallied your total debt, sit down with your budget document to calculate just how much you can afford to put toward paying off your debt each month
- Take an Interest: Look at your credit cards. Which has the highest and which has the lowest interest rate? If possible, you’ll want to transfer the balance from your card charging the highest interest to your card with the lowest. This debt repayment strategy is commonly known as the “Snowball Method,” and it can save you hundreds of dollars!
- Pay above the Minimum: Strive to pay twice the minimum payment each billing period. Otherwise, you’re unlikely to see your balance change, even gradually.
- Don’t Use Credit: Delete your saved payment information from online vendors, and leave your credit cards at home when you go shopping!
- Something Extra: Take excess funds as a power-up in your fight against debt. Put work bonuses toward debt repayment, and consider selling unwanted household items to make extra debt-reducing profits.
- Cash-Out Savings: This is a riskier method, and relies on you already having a substantial savings, but if you have the funds, consider putting your savings toward paying down your debt.
Think of your debt repayment as a short-term goal achievable in two years. Focus on money-gain, rather than money-to-spend, and surround yourself with positive, like-minded people! Free yourself from interest and due dates, and instead grow your emergency and retirement funds on your own terms!