Home Money & Finance How to Pay off Debts Faster

How to Pay off Debts Faster

by Olufisayo
how to pay off debts

Unless you were discerning enough at birth to have been born into financially favorable conditions, life is going to mean debt.

Cars and houses are usually the big two, with car payments and mortgages numbering many years of payments – in fact, the word mortgage literally means “death contract” (referring to the fact that the terms of the contract are only fulfilled when the contract is terminated, either through the completion of payment or through foreclosure).

Then there are costs such as home and garden maintenance or renovations, furniture costs, and even vacations. The temptation to get going in life and put all of these things on a credit card so that you can have them now rather than having to wait and save up for years on end is … well, it’s the standard way forward.

The problem is that over a period of months or years, these payments can mount up, significantly affecting our finances – check out friendly advice from Creditfix. Let’s go over how to pay off your debts faster.

Credit cards

You may be operating on the general advice that credit cards are a good idea. Using your credit card will build your credit score and remove the risk of losing your own money in any online transactions.

However, every time you swipe your credit card or type in your pin number or click ‘buy now’ online, your debt does nevertheless increase, and if you can’t afford the payments, something needs to change. Stopping using your credit cards and living within your means is a hard pill to swallow.

For many of us, this will induce a fear of missing out in terms of not keeping up with the glam lifestyles we see plastered all over social media. That’s why step two in our little guide is also a must…

Make a payment plan

Some of your debt will have a higher rate of interest attached. This is the debt that you should focus on repaying first and foremost.

You will need to work out how much money you can pay towards your debts each month, and make allowances for minimum payments towards the lower interest rate debt.

Then, put everything else towards the higher rate debt. Once you have figured out how much you can pay, you can plan how long the total repayments will take.

By making a payment chart (either in digital form or with a pencil), you will be able to better visualize your payment efforts – and with an end date laid out before you, you will hopefully take a little bit of stress out of the situation.

Recovering from debt often takes years. But you can do it. Start today and begin to look forward to tomorrow, instead of dreading each day.

Related Articles