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Getting into debt is one of the biggest problem we face in our life. You may find challenges in paying off debt, but if you take the right decision, then you can easily get rid out of debt.
Life can be back to normal like not having any debts on your head. Enjoying quality time with your family & friends and spending money in the absence of debt.
The portion of your earning is going in paying off your credit card bills or overdraft or loan (EMI). It means you are working for them, not for yourself. There are multiple ways where you can get rid off from Debts in quick time.
I will be going to share the ideas on how you can easily pay off all your debts fast.
1. Track Your Spendings
You might never know that your spending could be the reason for you to get into the debt problem. Check how much you spend weekly or monthly. Are your spendings going above your budget?
Sometimes we never know how much we should spend to keep ourselves within the boundary.
Most of the time, we overspend using our credit card/s in the impression that we have 45+ days to pay off. This makes our habit of using a credit card all the time we make payments.
Not controlling the spending, is one of the biggest mistakes we do in personal budgeting.
Take a pen & paper and write down how much you earn, what are your expenses and how much you can afford to save money to pay off debt.
2. How to Pay off Credit Card Bills
No matter whether we have money in our pocket or not, we still use a credit card for our spendings.
This is how we get into credit card debt every month. Credit card companies give us a chance to pay a small amount so that they can charge heavy interest on the remaining amount.
So, how you will pay off your credit card bills?
The best option is to stop using the credit card and it back to your bank. Now you have credit card debt but not credit card anymore.
Reduce your spending to 25-30% and have it used to pay off credit bills. Make sure that you pay more than the minimum balance of your credit card.
Once you start applying these ideas, you will notice a huge reduction in your debt and eventually, you will get out of it.
3. What to do When There is No Way Out from Credit Card Bills?
Ok, this is a serious situation where you stuck with your credit card bills and you can’t afford to pay EMI’s anymore.
The reason why you won’t afford to pay credit card bills is because they charge more than 20% on your total non-payment balance.
But, there is the way where you can pay the full amount of your credit card bills.
I never advise people to take a personal loan, but in this situation, I would advise you to go for a personal loan and have your credit card debt repayment.
The interest rates for a personal loan is far low compared to credit card interest. You can decide how much you can pay monthly by selecting the duration of the personal loan.
You can sell old stuff online to pay off some of your credit card bill amount.
I still advise you to try paying off your debt without taking a personal loan. This is the reason I have not mention the link for taking a personal loan.
4. Find Side Income to Pay off Debt
We must have side income to make our life better and happy. I have seen many people who work little to generate side income to have a smooth life.
There are various income ideas that you can start applying it from today.
Online Paid Surveys:
Spending 30-60 minutes a day can bring you the earning up to $30 each day. You just need to answer the survey and it’s done.
The survey company will send you the earned amount directly to your bank. The survey income is little fast and this will help you to get debt relief in quick-time.
There are some survey companies that pay a higher amount on each survey you answer. You can sign up with these companies and make the most out of it.
Do you want to earn extra money?
Make sure that you register yourself as a seller. A seller on the fiverr platform is known as a freelancer.
Whatever you know, just mention it on your profile. Fiverr will show your profile to the people who are looking to outsource their work related to you.
These ideas will definitely work out for your debt repayment.
Is it better to Pay off Debt or Save Money?
You should pay off your debt first and then save money. If you ignore your debt and keep saving money, then your debt interest will eat your savings slowly.
If you really wanted to save money, then I would advise to save 20% and pay debt 80% of your money after expenses. Invest that saving in dividend stocks through Acorns.
Which debt should I Pay First?
First, you should payout debt which has the highest interest rate(Credit card) and EMI’s and then settle the other debts.
Founder of twomillionways.com
MBA – London
I am here to share my ideas and experience on how to make real money.