If you have a large amount of debt that you need to pay off, you likely feel that this burden will take most of your life to crawl out from underneath, especially when it comes to home loans. And while this can be the case for some people, the situation will really only start improving once you buckle down and become dedicated to paying off as much debt as you can as quickly as possible. So to help you start on this process, here are three things you can begin doing that will start to shrink your debt.
Tackle The Big Ones First
Having multiple lines of credit that you’re trying to pay down can be hard to manage. Especially if you can’t decide which one to focus on first, you may feel like you’re always paying money each month but never really seeing the results you were hoping for. If this sounds like you, Stephanie Steinberg, a contributor to U.S. News and World Report, recommends that you continue making the minimum payments on your debts but that you also put any extra that you can toward the debt with the highest interest rate. By paying this debt down first, you’ll be saving yourself a lot of money on that interest. And once that piece of debt is out of the way, put your financial efforts toward paying off the debt with the next highest interest rate.
Make An Extra Payment When You Can
Another great way to pay down your debt as quickly as possible and save money on interest over the life of the loan is to make extra payments when you can. If you get a bonus from work or a big tax refund, commit to yourself that you’ll put all that unforeseen money toward paying off your debt. While you may want to spend that extra cash on something fun, the freedom you’ll feel once your debt is paid off will be worth it. To help you see the light, Jeanne Lee, a contributor to NerdWallet, recommends using a debt payoff calculator to see just how beneficial your extra payments will be for paying off your loan faster.
Use Helpful Tools
If you still need additional help to pay off your debt, there are quite a few tools available to assist you with this. According to David Weliver, a contributor to Money Under 30, you can transferring your debt balances to an account with lower interest rates or consolidating your debt into one chunk that you pay off to help you get out of debt at a more accelerated rate. While these strategies won’t work for everyone, they are worth researching if you’re looking for additional options.
If you need some new ways to help you get out of debt faster, considering using the tips mentioned above to help you do just that.