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Sometimes when you’re climbing your way out of debt, you have a few tweaks you can make to speed up the process. Use these tips when you’d like to quicken your pace towards a debt-free life.
You might think that doubling up on payments for your low-interest, long-term mortgage is the proper way to get out of debt fast. However, it makes more sense to focus additional funds on high-interest accounts, such as a consumer credit card. You’ll save more money by focusing on eliminating the extra interest.
If you still rely on credit cards, you could end up in a situation where you’re in more debt than when you started. Cutting up your cards makes it difficult to use them. If you don’t want to go quite that far, consider freezing them in ice and hiding them in your freezer. Don’t forget to delete saved credit cards in your mobile wallet and on your frequently used online shopping sites.
Did you get a big tax refund, birthday gift or another unexpected windfall? Stick with your base budget and treat this money as a way to leap ahead on your payments. You can certainly set some aside for fun money, as it’s difficult to stay on pace with repayments if you never enjoy yourself. However, most of your windfall should go towards your priority accounts.
Sometimes the credit card companies that you do business with will offer promotions with balance transfers. They may provide no-fee transfers, zero percent APR, or another attractive opportunity. Do the math to see whether you would save money on interest by moving your debt around from other credit cards and accounts. Sometimes, all you need is a break on the interest rate with a zero percent APR balance transfer, and you can speed things up significantly. The best balance transfer credit cards can keep you from paying too much in credit card interest.
Becoming debt-free is a marathon, not a sprint, but these tips can help you pick up the pace. This process becomes easier as you finish off each account. Before long, you can breathe a sigh of relief and relax.