Getting rid of debt is not as simple as you may think. For a lot of people, it takes everything they have just to pay the monthly bills, let alone make debt payments or save something for the rainy days.
Thankfully, there are ways you can erase debt from your life. All you need to do is take on a systematic approach and make a few lifestyle changes. Here’s what you need to do:
Organize Your Bills
Before you take on a debt management plan, you should count all your bills and make a list of your monthly expenses. After that, check your credit card and bank statements of the last six months, and calculate the amount you owe, the money that goes into the monthly bills, and other mandatory expenses. Such an exercise will prepare you for what comes next.
Try Debt Settlement
Once you have an exact figure you owe to your creditor, try to settle the debt. Debt settlement, also known as debt adjustment or debt relief, is a method in which the delinquent debt is resolved for less than the actual amount that needs to be paid. In this method, you promise your creditor a lump-sum amount of money.
Go for Debt Consolidation
Usually, debt settlement offers range from 10-50%. However, if that doesn’t work for you, you can go for debt consolidation. It is especially helpful for people who are unable to make debt payments every month due to the high-interest fee. In this method, you refinance your debt with a consolidation loan and pay off your debt in full or two parts.
Pay More than Minimum
For those who have the money to pay off their debt, this is the best way to erase the debt quickly. Yes, you must start paying more than the minimum payment. It’s the best way to get rid of debts with high-interest rates. Not to mention, it is something that can save you a substantial amount of money in the long run which you can add to your savings account.
Ditch Credit Cards
Credit cards come with the highest interest rate. It’s indeed correct that using credit cards is pretty convenient as you get to pay for everything digitally without having to carry cash. You can purchase things even when you don’t have money in your account but as mentioned earlier, this convenience comes with a price. Thus, you must avoid using credit cards and go with cash instead.
All these things won’t be simple for you, but they will surely get you out of debt. Try them out and see for yourself!