When you find yourself with too much debt and need to pay it down quickly there are a few strategies that will help you. Understanding how credit works is the first step to maintaining manageable debt, but if you’ve gotten in over your head try using these tips to get it under control and help with your debt payoff.
Evaluate your debt accounts. If there are some that have higher interest rates than others, then those are the ones to focus on. If at all possible try transferring the balance to lower interest cards, but if you can’t do that then make sure that you pay more than the minimum charge each month. The extra money goes toward the principal of the account and helps get your balance lower each month.
If you have several cards, try to pay off lower limit cards by making extra payments each month. Once those cards are paid off you can seek one major credit card with a low interest rate and transfer other balances to it.
Ideally, you should be able to get down to one major credit card. Then eventually no credit cards or lines of credits. The same tips can help with your mortgage and car payments as well. Pay more than the minimum payment every single time, even if it’s just a few dollars.
Final Thoughts on Debt Payoff
Accumulating debt is easy; paying it off in a timely manner can be a bit more difficult. Manage your credit responsibly and take time to evaluate and strategize whenever possible to keep your debt low.