Research estimates that all Americans owe more than $7,000 on their credit cards alone, and the average general debt loan per person is more than $15,000. Furthermore, all college graduates are already saddled with loans in excess of $35,000 when they leave college. Do the statistics surprise you?

Most of you owe thousands of dollars worth of debt. And every month, you pay interest on the money you borrow, interest that adds up over time. So why not pay off all debt as quickly as possible? Once debt free, you would not have to pay any monthly payment or any amount of interest.

Sound harsh? How are you going to pay your loans? As difficult as it may be, if you are determined, you can take good control of your financial situation. We’ll share with you some amazing tips that will get you off your debt fast, and then we’ll talk about what you need to do once you’re debt free.

1. Pay more than the minimum amounts

This is advice that applies to your credit cards, student loans, and other personal loans. Considering credit cards, the average balance of any individual is around $15,000 as we mentioned at the beginning. If the APR is 15%, it means that the minimum amount to pay to the bank is only $625, which you will be paying back in around 13.5 years. Isn’t that too long? Also, let’s not forget that it will take you longer to repay the borrowed amount if you continue to use your credit cards for other purchases during this time.

Instead of paying the minimum amount, your monthly payments should be as large as possible. This will help you save thousands of dollars in interest and allow you to pay off your loan much faster. But before using this tip, contact your bank and make sure there are no prepayment penalties.

2. Try the snowball method

The snowball method is a popular strategy for paying down your debts, again based on paying more than the minimum monthly amount. List all your debts starting with the smallest, which is the one you will address first. Overuse your funds and pay more than the minimum amount for the smallest debt. For your other larger debts, you would still pay the minimum amount.

Now, when you’ve paid off the smallest debt, you can move on to the next debt on your list and start paying more than the minimum amount for that one. In this way, you can continue paying all the debts one by one. As your small balances disappear, you free up more dollars, allowing you to pay off your larger debts more quickly. The basic goal at all times is to use all your extra money for debts, starting from the smallest, until you have paid them all.

3. Try to increase your streams of income

How many sources of income do you currently have? If you’re just doing a job, how about going into other businesses or companies part-time to earn more money? Doing so will give you more control over your finances, making it easier for you to become debt free.

Reflect on your strengths and see how you can use them. Create an account on websites, like Upwork, where you can freelance in a wide range of industries. And even if you’re not a technical master, it’s absolutely fine. You can still babysit someone, mow the lawn, or take a job as a cashier at a local store. So earn some extra money and use it to pay off your debts. And once again, do it through the snowball method that we have already discussed.

4. Create a basic budget… and stick to it

One of the best and most effective ways to pay off your loans is to reduce all your expenses and spend only the minimum that is required. As difficult as it can be, it is one of the fastest ways to get out of debt and definitely worth a try to improve your financial situation.

You can create a basic budget that allows you to reduce your expenses as much as possible and live only on what is absolutely necessary. Since all of you have different needs, your minimum budgets will also be different. But one common thing would be the fact that the budget would be devoid of luxuries like eating out or watching movies. Avoid all unnecessary expenses and use the amount you have safe to pay off your debts. By the way, when you’re debt-free, you can revise your budget and increase your spending, but only as much as your income allows. Don’t go into more debt to satisfy your cravings and desires.

5. Sell items you don’t need

An easy way to get fast money that you can use to pay off loans. Go through all your belongings and set aside the things you really need and use regularly. Now sell all the remaining stuff and then use the money to get out of debt. The easiest way to sell items is probably a garage sale. But if you’re not allowed to hold one in your neighborhood, you can sell online on various websites like eBay.

6. See if you can get a lower interest rate on your credit card

What are the commissions and interest rates of your credit card? And how much money goes into them? Generally, these amounts are on the higher side, often eating up a large portion of your expenses. But sometimes lenders can budget and review your rates, if you have a good credit history and have made your payments on time. So talk to your credit card provider and try to negotiate more favorable terms.

7. Negotiate your invoices

Has your credit card provider not agreed to lower interest rates? Don’t worry, try to negotiate your other monthly bills now. Yes, you can talk to your utility providers and they will usually be more than willing to give you a better deal. Start with your cable and satellite TV service provider because they are usually the most willing to negotiate. Prepare for the meeting, learn about the rates offered by other service providers, and then present your case. What if it doesn’t work? You’ve still done your research, right? Switch to a provider that offers a lower rate for a similar package. You can also negotiate your internet bills in a similar way. And by the way, combine your Internet and TV bills if you haven’t already, because you can get better rates when you choose the same provider for both. Also try to negotiate your medical bills, insurance premiums, and rent amounts.

8. Consider transferring scales

Another strategy to try if your credit card provider won’t accept lower rates. Balance transfer options are fairly common, and if you do some research, you may even be able to find an option that allows you to take advantage of 0% APR for around 12 or 15 months. There may be a small fee involved, usually around 3% of the amount transferred, but this is still a good option. In the long run, you can save money that you can use to pay off your debts faster.

9. Combine your debts

Combining debt and credit or combining bills allows you to simplify all your bills by combining all your debts into one monthly payment. Not only is the loan easier to manage, but you can also get a lower interest rate. The option can be used for multiple debts, multiple creditors, and multiple payments. All of these bills are settled through a debt management program, after which you make a single payment every month for the next 3-5 years. When you pay off all of your debt with a single new loan, you enjoy several benefits, such as reduced monthly expenses, better cash flow, increased savings, and less stress. Before signing up for any program or loan, it may be a good idea to discuss all possible debt combination options with a financial advisor.

10. Use your bonuses or raises

Did your employer reward you with a bonus or raise this year? Or maybe you got a tax refund. Whatever kind of extra money you get, avoid spending it on something unnecessary. Instead, use it for your loans, paying more than the minimum amounts.

11. Get rid of your expensive clothes

Are any of your clothes too expensive and take up a significant part of your monthly expenses? If you are in debt, you should try to get rid of all your expensive habits. Find out how you are spending money on a daily basis and then assess whether or not these purchases are really worth it.

Drinking and smoking are habits that you should definitely give up, not only to reduce your expenses, but also to improve your health. If you eat out often, avoid that too.

12. Avoid using credit cards

When your goal is to pay off your debts sooner, you should stop using credit cards altogether so you don’t increase the amount you owe. Does it seem difficult? Leave your cards at home instead of keeping them in your wallet. If you have to use them for an emergency, be sure to pay the full amount next time so no interest is added. Another option could be to use a debit card, which funds the transaction with the amount in your bank account. You’re just using your own money so you don’t add to your debt.

Now that you are debt free

Follow our advice and you will be able to pay off all your debts. And when you have achieved this goal, what do you do next? This is what we suggest.

treat yourself

Because you really deserve it after all those efforts to successfully minimize your expenses to be debt free. So allow yourself to relax, but don’t do anything too fancy.

Check your budget

Until now, you were paying all of your extra money to eliminate your debts, but now that the goal has been achieved, you can use the money for something else. Do you think you’ve been burning out at work? Take a vacation then. Or you could use the money for a home improvement project.

But whatever you do, make a proper financial plan. And this plan should not be based on borrowing more money. Because if that’s the case, there was no point in getting out of debt.

increase savings

Since you no longer have debt, you can think about increasing your emergency funds. If your savings accounts are already impressive enough, then maybe you could start saving for a new car or a down payment if you live in a rental unit.

Boost your retirement accounts

How much money have you set aside for retirement so far? Think of ways to improve your retirement plans. You can increase your monthly contribution or enroll in a different plan.

Keep in mind that if you increase your contributions by just 5% or 10%, they will all add up over the long term and become significant when you retire.

Consider alternative investments

Because some extra income is always desirable, right? Invest your savings in a new project or enterprise. You could enter the real estate market, the stock market, or any other industry. It all depends on how much you are willing to put up. Regardless of what you choose, analyze the risks and develop effective mitigation strategies.

Set up a side business

You can even set up a side business if you have enough time and entrepreneurial skills. Get it right, and if you’re lucky, you may not need to do any more work.

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