Manage your debt before it gets out of control
Whether your debt is on credit cards or from other sources, take a proactive approach to paying it down. Manage your debt before it gets out of control by starting with one or more of these simple tips to pay off or reduce your debt.
1. Pay More Than the Minimum
Start by paying more than the minimum required payment on your bill. That minimum keeps the extra fees at bay, though it doesn’t keep from charging you interest, nor does it bring down the principal amount. Pay as much as you can manage each month to chip away at the principal.
2. Pay Your Smallest Bill First
If you have multiple bills to pay, pay down your smallest bills first, and when each is gone, put that amount toward paying off the next largest. The accomplishment will keep you motivated to keep it going.
3. Pay The Highest Interest First
As an alternative, start with the card charging you the highest interest, and concentrate on paying that down first. Then move on to the next lower rate card.
4. Pay Revolving Debt Before Installment Debt
If you have both revolving debt (borrowing against an open line, like a credit card) and installment debt (paid back in fixed amounts over a set period of time, like a mortgage, car, or student loan), reduce your revolving debt first and faster, while continuing to pay your installment debt.
5. Adjust Your Budget
Find places in your household where you can temporarily cut back, and put that savings toward paying down your debt. You may even find, after your debt is paid down, that you’re used to the new budget, and you can put the new savings to work for you.