Being in debt of any kind can be incredibly stressful and overwhelming. This is especially true if you feel out of control of your own finances. Those who find themselves in this situation also can struggle to save any money at all. However, the good news is that getting on the fast track debt relief is possible and not as difficult as you might think. The first thing is finding the money to put toward your debt. This happens by being diligent with spending. Here are some of my top tips for eliminating debt quickly.
Always Know Your Credit Balances
It’s important to be aware of your credit card and loan balances. The main reason is to keep you from using credit too much or beyond your means. Secondly, your credit score is greatly affected by your credit usage ratio. Ideally, you want to use less than 30% of your total credit limit.
Pay Smaller Balances First
If you have a number of credit card and loan payments, it’s best to pay off the smallest one first. You can then use the money you budgeted to pay that bill to put toward the next highest bill. You continue this process until you have paid off all of your debt. Though this is a simple concept, it works extremely well and faster than any other method I’ve tried.
Set Up Automatic Payments
Automatic monthly drafts can be a stress-free way to deal with debt. It keeps you from worrying about whether you’ve paid your bills on time. Not to mention, it keeps your creditors happy, knowing they will get paid regularly. If you have extra money to put toward a bill, simply pay it in between your auto payments. This also helps your credit score. Additionally, if you have a savings account, set up automatic deposits. Even if this is a small amount, you’ll see your savings grow without even thinking about it.
Give Up an Indulgence to Pay Debt
If you want to get out of debt quickly, it’s going to take some sacrifice. For instance, if you visit your local coffee shop daily for a fancy latte, consider giving it up for a while. Though it may not seem like much, that $4 a day coffee habit adds up to $120 in a month and $732 in six. I’m betting that might put a dent in a bill or two. Of course, that’s if you give it up every day. You could just cut back on your indulgence.
Don’t Carry Your Credit Cards with You
Though it might be a good idea to have one card with you in case of an emergency, I recommend keeping the rest at home. This is a surefire way to prevent yourself from charging impulse items while you’re out. If you struggle with online temptations, you might have to take more drastic measures like cutting them up or giving them to someone for safekeeping.