Living with debt can feel like you have a weight on your shoulders and that’s certainly no way to carry on. If you feel burdened by the amount of debt you have incurred over time, you can make 2018 the year you get rid of all your debts. Here’s how:
Don’t ignore the problem
It might feel like a good idea to pretend that your debt problem doesn’t exist, but it really isn’t. It is best to tackle your debts head on instead of leaving them develop into a monster that you’ll still have to deal anyway.
Evaluate your Debt
It is possible that your debt isn’t actually as bad as you think, but the only way to know for sure is to actually take the time to assess it. Once you get the clear picture, it will become easier to determine which debts are priority.
Make a debt escape plan
Think of this as you waging a war on debt. Every general needs a war strategy, so determine what yours is based on the nature of your debt.
Select a Repayment Approach
To craft a war debt repayment strategy, you need to determine the payment approach to use. You could decide to start with the debt that has the highest interest or start with the smallest one. Pick one that you know you can be consistent with.
Get Organised – Prioritise
It helps to organise your debts because that helps you prioritise. As a general rule, you should take care of the more dangerous debts first – the ones that could land you in jail, for instance.
You shouldn’t spend too much when you’re trying to pay off debt. Cut out everything non-essential, from impulse buying to subscription.
Pay on time
In order to avoid have to pay even more in the long run, be sure to make all your payments on time. That way, you’ll prevent more debt from pilling on top of what is already there.
Re-jig your debts
Another great tactic to help reduce debt is to switch to a better credit card which might be one that doesn’t charge interest for a given period or one with a lower rate. However, this does not cancel your debt, it only buys you time.
Don’t borrow more
You can’t have diabetes and continue to stuff yourself with sugary treats. It’s the same way you can’t borrow more when you’re trying to get off debt. Just don’t do it.
Put your savings towards your debts
To pay off your debt faster, dig into your savings. It might hurt to have to touch your savings, but it’s worth it.
Form New Habits – Budget and Stick to it
You might create a strategy and all that, but to successfully cut debt, you need to form healthier financial habits and be discipline. Learn how to create budget and stick to it and you’ll be debt free sooner than later.