Debt is something all humans go through in their life. Some manage it really well and some go down the endless pit of debt and never return. It is all about how you manage your income and expenses. Here’s how you can get rid of debt easily.
Here we are bringing you five useful tips on how to manage your money and how not to be stressed about being in debt. There’s nothing wrong about being in debt if you can pay them off duly without having to go through troubled days.
Luckily, there are many ways to get rid of debt, and not all of them will make you miserable. Some of these tips we highlight below can even be used in tandem in order to help you squash debt faster.
How to Get Rid of Debt
Ready to get rid of debt? Here are 05 ways to get going.
01. The Snowball Method
The first step of this method is to make a list of all the debts you owe (from smallest to largest). And collect all your excess funds and pay off the smallest debt. While doing this pay the minimum payment amount on your larger debts such as credit card debts.
When the smallest debt is paid, you will get the chance to use those excess funds to pay the next smallest debt. By continuing this method while paying attention to due dates on the side, you will be able to manage the debts and get rid of them sooner than you think to give you sustainable mental satisfaction as well.
02. Paying more than the Minimum Amount
People have many types of debts; credit cards, personal loans, student loans, etc. And many people choose the method of just paying the minimum amount due. This is not the best practice. The most ideal method would be to pay them sooner when you have money. It won’t hurt to pay a bit more than the minimum due payment because it will help you get out of debt sooner than planned.
For this, you have to be cautious about the payment plan beforehand. When you borrow money, make sure that you will not have to face any prepayment penalty charges. Some lenders have these kinds of rules and regulations in their agreements, so be sure not to obtain such a loan at all times possible.
03. Bid Goodbye to Expensive Habits
You may have heard many stories about how millionaires and billionaires lost everything because of their expensive habits. This culture has become almost unavoidable due to Social Media and popular culture. But this does not mean that you cannot avoid the wave. If you do the best to ditch all your expensive habits while on debt, you will be able to pay off them sooner and live a real stress-free life.
Look carefully at how you spend your income on a daily basis. Maybe you eat out too often, maybe you try out expensive malls too often, maybe you go out with friends to expensive places too often, maybe you want to keep up with the trends so much that you buy expensive attire too often. All these unwanted habits can be dropped if you try. And once you are out of debt and pretty stable on your own, you will be able to do those again. But remember that it is never a good idea to get used to expensive habits.
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04. Negotiation is the Key
Always try to bring the interest rates down by negotiating with the credit card providers. Many people get into the trap of debts because of credit card usage. But if one can use them wisely, credit cards can also be your savior. It is all about how you handle the payments and how you choose a credit card provider.
Always go for a lesser interest rate. Always try to negotiate and bring down interest rates. There are so many customizable credit card plans available at the moment.
Not only credit card bills, but there are also several other types of bills and debts which you can customize or negotiate to bring it down. And in addition, keep track of all your debts and bill payments in an orderly manner, so that you would not miss any payment and face unwanted penalty fees.
05. Summer Jobs and Part-time Jobs
Are you someone who gets a long summer holiday? Do you have any time after your daily usual work? Then it would be a great idea to do a summer job or a part-time job in the time left. This idea works out best for students but might fit regular work people as well.
Seasonal jobs and part-time jobs have been around for a long time and practically pop-up everywhere when needed. Take a stroll around the alley and you will find a dozen job opportunities. Some might require physical activities while others don’t. Think of the requirements and the pay they are offering and choose a better seasonal or part-time job and save up some money to pay off the debts. Choose a reliable job carefully so that you would not be disappointed on the payment day.
There you go. Our 05 ways to get rid of debt and breathe fresh air into your debt-free journey. Try a few of these tips and see if they work for you. Cheers to a debt-free life.
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