Debt is the biggest curse of modern living, but you don’t have to be bogged down by massive monthly credit card payments or always in the red. These tips will help you settle your debt quickly, and work your way to the financial freedom you’ve always strived for, but never been able to achieve.
Stop Making More Debt
This may sound silly, but so many people are in debt, and then continue to run up accounts and simply turn a blind eye. Take a look at all your credit cards, store cards and loans and then make a conscious decision not to use any of them, unless it is an emergency.
Increase Monthly Payments
Wherever you can, increase the amount of money you pay into your debts monthly. This means you’ll pay them of faster and pay less interest- and that’s a win-win situation for sure. If you win anything at betting sites make sure you use at least half your winnings to pay off debt.
Settle the Small Debts First
If you have a few smaller debts that are adding up each month and the interest is crippling you, make a concerted effort to pay them off one by one. If you start with the smaller debts you’ll have more funds available to plug in to the bigger debts in a shorter period of time.
Ask for a Lower Interest Rate
If you have a good payment history and are always prompt with your monthly instalments ask your creditor if they can reduce the interest rate. Sometimes you get the answer you were hoping for, and the rate is reduced, even if only for a short period of time. If you can, put everything you can into the loan while the interest rate is reduced in order to take full advantage of it. A debt counsellor may be able to assist you here, as they are able to negotiate with institutions on your behalf too.
This can be a good idea, but before you go for it, do your homework. Try and see if you can pay off everything you owe using money from the credit card or loan that has the lowest interest rate. This way, you pay back one institution every month and you benefit from lower interest, and only one set of banking fees.
Work with a Financial Adviser
A financial adviser will be able to help you determine why you have accumulated so much debt, and how best to reduce it. Sometimes, the simplest solution is only spotted by someone with a professional eye, and it may be worth investing in a one-off session with someone who really knows how to make money work for you.
Borrow from Investments
Usually we wouldn’t suggest this, but in some cases, borrowing money from an investment and paying it back when you are in a better financial position is a good idea. If you’re running in to trouble with debt and need to settle it, incurring penalties from withdrawing funds from a policy or investment may be better in the long run, but remember, once you have paid off your debt, you need to save up and pay back what you took out!