How to Pay Off All my Debt Quickly
When was the first time you received a credit card? You felt as if you were gripping financial independence in the palm of your hands. You might remember how thrilling this was when you swiped that flat piece of plastic for the first time. Perhaps a car failure compelled you to ask for a loan so you can finance the repair. “Financial freedom is mine!” you thought.
However, one card doubled into two, and two multiplied into ten. Your vision of unrestrained spending has now turned into a nightmare of serious debt, exorbitant fees, and maybe even collection calls. If this describes you, be rest assured that you are not alone. Non-mortgage debt is now more than $22,000 for the average Canadian! Many people have “bad debt,” which includes items such as auto loans, credit cards, and payday loans, all of which have high-interest rates.
Do you find yourself drowning in debt? This article will show you 9 steps you can take to pay off all your debts quickly.
- Pay above the Bare Minimum
Paying simply the bare minimum in your debts will make it difficult to pay off the principal amount. Because a high percentage of such minimum payment will be used to offset the interests, choosing to pay the interest off with this approach will not move you far ahead. You need to be making payments that are way above the required minimum so as to double your payment pace.
- Start With the Highest-interest Debt
You can reduce your total debt burden and save thousands of dollars in interest payments over time by first of all paying down the one that has the highest interest rate. Don’t neglect the debts with the low-interest rate, but let your efforts be towards your biggest debts. This will allow you to pay off your debt faster and save money on interest payments over time.
- Begin a Second Job or Get a Passive Income.
If you have the opportunity to work on the side, take it! Put any additional money you earn towards paying down your debt. Passive income flow is also a great idea, but it is more difficult to achieve and it requires some capital. When looking for a side hustle, seek for anything that won’t drain the major part of your time, but will provide you with enough extra cash to make a significant dent on your debt.
- Live Within a Small Budget
If you develop a realistic budget for your income and especially your expenditure – your money flow will become clear to you, and you will see how much additional cash you will get at the end of the month. You can then use this extra cash to pay off your debts.
Being disciplined in the way you use your credit cards for the first few months will help you not to spend more than you can afford. Staying under your budget every month may not be that easy, but as long as you meet your goals more, you will be fine. It will be much easier for you if you try sticking to your budget.
- Get Rid of Unnecessary Items
Most of us have items lying idly around – such that we don’t have a need of. If you’re looking for a quick way to pay off debt, consider selling items you don’t use very often and won’t miss. This is when websites like Facebook MarketPlace and Kijiji come in handy. You can trade your unwanted items piece by piece, generating small amounts of extra cash that you can use to pay down your debt.
- Negotiate reduced credit card interest rates
You may be able to negotiate a reduced interest rate on your credit card. If your card provider refuses to budge, consider transferring your balance to another card or organization. It’s crucial to consider the transfer fees rate or costs involved with switching from one credit card to another.
*Please keep in mind that balance transfers might lower your credit rating and should be utilized with caution. Opening, closing, and moving balances on a regular basis might have a negative impact on your credit score.
- Give up Extravagant Lifestyle
Some habits are extravagant, such as the $4 daily coffee, smoking, drinking, and so on. Ensuring to cut down on this type of extra spending will allow you to stay inside your budget and save you thousands of dollars in a year.
- Become a One-car Family
If your family owns two automobiles, consider selling one, utilizing public transportation, or carpooling to work. Using only one automobile can save you thousands of dollars per year. The average annual cost of owning and operating a vehicle is over $9,000. This will make a significant difference if you use such money to offset the debt. If you want to prove this concept first – do this:
Park your car for some time, reduce your insurance to “pleasure use only,” and see whether utilizing public transportation, walking, cycling, or carpooling is a better option. The occasional cab ride or rented car won’t cost as much as maintaining your second car. If you have any opportunity to use public transportation, it is generally 80 percent less expensive than owning and using a car.
- Talk to a Credit Consultant
Speaking to a credit counsellor is one of the best ways to get out of debt. Find out what services are available to assist you in paying off your debts. A professional credit consultant will clarify all of your alternatives and assist you in selecting the best option that suits your needs.
Many people are unaware of key information about debt-free programs offered by debt solutions company like EmpireOne Credit Solutions. The majority are glad they did take the time to learn about these programs and to salvage the situation before it went out of hand. Our Free Consultation is confidential, friendly and non-judgmental.
Talk to someone today at EmpireOne Credit Solutions and see how you can get out of debt quickly.
