Quick Tips to Pay Down Debt

Getting rid of your consumer debt is an excellent way to increase your credit score, relieve financial stress, and place yourself in a position to succeed financially in the future. However, it can also be a challenge to do so with rising costs, a shortage of funds, and sometimes overwhelming interest costs. It is true that there are a lot of hurdles to overcome, but with patience and diligence, anyone can start paying down and reducing consumer debt. Here are some easy ways to get started reducing your debt today.

Talk To Your Credit Company Or Lender

Talk to your financial institution if you are having difficulty paying your debts. You might be able to set up a repayment schedule, reduce your interest rate, or find other options that can help you. Until you ask your creditors about your current debt, you may not be aware that there are options available to you.

Also, if your credit score was negatively impacted because of late or non-payment of bills, talking to them can ensure that it is improved by showing that you are able to follow through with a repayment plan and work together to solve the issue.

Consolidate Your Payments

Find out if you can consolidate your credit cards into one lower monthly payment through a consolidation loan. With a consolidation loan, you can extend your payment period and/or get a lower interest rate in the long run. Don't get into more debt by paying off any credit cards you pay off with the consolidation loan.

You can also try applying for a balance transfer credit card, where you can transfer your debt to the new account and pay no interest on it for a set amount of time. Make sure you find a credit card that has no balance transfer fees and a lower interest rate.

Cut Yourself Off

No matter how much credit you have available, you don't have to use it. You should not use your credit card until you have paid off a certain amount. Take your credit card out of your wallet and remove it from your online accounts. You can't use it if you don't have access to it.

If you have a large amount of credit available on your cards, you'll be tempted to use it. You need to avoid that temptation as much as possible until you've started paying off your debt.

Make More Than The Minimum Payment

If you make the minimum payment every month, your interest charges will continue to increase long after your purchase. Consider paying the minimum payment plus the monthly interest amount (or more, if possible). Making the minimum payment by the due date is good, but as a bonus, you can make additional payments later in the month, which may also help your credit score.

Use The Snowball Method

The snowball method involves "snowballing" the process of paying off your debt. Start with your smallest balance and pay it off completely before moving to the next one. Use the previous card's minimum payment plus overage and apply it to the next card. Repeat this process until you've paid your credit cards off completely.

Once you have paid off the larger debts, the struggle will feel less daunting and it should be easier to tackle each new one. You can use this method on credit cards or other debts, such as personal loans or any other outstanding balances.

Get a Side Job or Side Gig

Getting a side job to pay off your debt can be a great way to start reducing your payments. It can also help you get out of debt faster. Consider taking on a part-time job, starting a small business, or finding other ways to make extra money.

If you are already working full-time, look for opportunities to work overtime hours or take on extra shifts. You could also start looking for opportunities to work from home. There are many online and freelance opportunities that can help you make some extra money.

Talk to a Financial Counselor

Many people find talking to a financial counselor helpful in repairing their finances and getting out of debt. Financial counselors can provide you with advice on how to budget your money, consolidate your payments, and reduce your interest rates.

They can also help you create a repayment plan that will work for you and your budget. Financial counselors can be found through nonprofit credit counseling agencies or through your bank or credit union.

If you are struggling to make ends meet, talk to a financial counselor today. They can provide you with the help and support you need to get back on track financially.