5 Things That Will Help You Get Out of Debt Faster
Debt can cause major stress in your life. It can cause you to lose sleep at night and miss out on opportunities. Paying off your debt can be an essential element to your happiness. Here are five things that will help you get out of debt faster.
Using Credit Cards Less (Or Not at All)
It’s estimated the average American household has over $6,700 in revolving credit card balances. This is the amount of credit card debt that’s carried over month-to-month, accumulating interest all the while.
People who carry revolving balances for a long time end up paying lots of money in just interest. This can lead to consumers sometimes paying twice as much or more than the amount they originally owed on their credit cards.
You can deal with this issue by limiting your credit card spending to essentials, such as utilities, or else not using it at all. Try leaving the cards at home, and only paying for things in cash. Reducing how much you spend on credit, and thus limiting interest, will help you get out of debt.
Budget Your Money Better
Budgeting is one of those things that few people want to do but can benefit almost everyone. Building a budget can let you see exactly where your money is going. You might be surprised to find some of the ways you’re letting dollars slip away.
This isn’t going to be an issue if you’re keeping up with a budget. You can even opt to download a budgeting app to your phone. A lot of these will have built-in tools that connect to your various accounts and subscriptions. You can easily make decisions that will save you money. Being on top of your money like this can help you get out of debt much sooner.
Use the Avalanche Method
There are several debt repayment methods that can help you overcome your debt. When it comes to getting out of debt the fastest way, however, you should consider the Avalanche method. This has you pay off your debts in order of highest interest rate first, while making minimum payments on all others. This will get you out of debt fast, while spending the least amount of money.
However, the Snowball method has actually been shown to be the most effective way of paying off debt. This has you pay your smallest balances first, regardless of interest rate. The psychological boost of that immediate progress helps many people stick with their repayment to the end.
Ask for Help
There’s nothing wrong with asking for help when you find yourself in a tricky debt situation. In fact, this can help you overcome it much faster.
It’s possible someone you know will be able to give you some great advice for how you can beat your debt. Some friends or family members might even be gracious enough to offer you money to help pay down what you owe.
There are also organizational resources you can pursue for help with your debt. Credit counselling is often a good place to start, as they’ll provide you with good advice and places you can look for further help.
People looking for major debt relief solutions can consider debt settlement — working with an organization to negotiate down what you owe to creditors. Some people can eliminate their debt in as little as 24-48 months this way. To get a feel for the ins and outs of settlement, take a look at Freedom Debt Relief reviews. This organization has a reputation for helping thousands of enrollees settle billions in debts.
Make More Money to Pay It Down
Maybe the quickest solution to getting out of debt is to find ways to make more money. This certainly isn’t always the most glamorous solution. It can require you to take on extra work in order to boost your income.
However, it can sometimes be as simple as asking for a raise or getting a new job. You should also consider if you can sell any unused items around your house. This can provide you immediate cashflow you can put towards debt repayment.
No one wants to stay in debt forever. Most people want to get out of debt as soon as possible. Following these steps can help you tack debt in less time.