5 Tips for Getting Rid of Debt

Getting rid of your debt completely needs to start with the first step. While your debt might seem like a huge mountain right now, you can start to reduce it so that within a few months, the amount seems a lot less daunting. Whether you have credit card debt, auto debt or you’re in some other kind of financial trouble, here are some useful tips for getting rid of your debt.

  1. Increase the amount you’re paying off each month

Paying the minimum each month will mean that it takes a lot longer for you to pay off the debt, and in many cases, you’ll only ever be paying the interest on your debt. Most of the time, the lender won’t mind how much you’re paying off as long as you pay the minimum. It’s important to remember that the longer you have your debt, the more interest you’ll accumulate, and your debt could actually increase rather than decrease, even though you’re paying it off.

  1. Try to change your utility plans

If you can reduce the amount that you pay on your utility bills each month, you’ll have some extra left over to pay off your debt. While you might think that this means living less luxuriously for a few months, you’ll feel like you’re free and financially stable when you’ve got rid of your debt.

  1. Look for good credit card deals

If you have a few credit cards which all have a little bit of debt on each, a great way to reduce them quickly is to consolidate them all onto one credit card. If you have a low credit score, you might find it difficult to get a credit card, but if you’ve been making the payments on each consistently, you won’t find it too difficult to find a decent deal. Look for a low interest rate or even one which offers you several months of interest-free use.

  1. Make a plan

Look at your debts and decide on a plan of action. You might want to concentrate on getting rid of the biggest debt first, or perhaps choosing the one with the highest interest rate is a better option. Whatever you decide, stick to your plan rather than changing it up every week or two.

  1. Pay bills as they come

Rather than leaving all your bills until the end of the month and then realising that you can’t pay any extra on your debt repayments, you should pay each bill as it comes through the door. You can set up Direct Debits to go out throughout the month so that it doesn’t hit you so hard on one particular day or week of the month.