Debt is about as American as baseball and apple pie and it's safe to say the last couple months haven't been great for everyone's bottom line. With everything that’s going on, there’s enough to worry about without having to try and figure out how to start paying off the piles of money you owe so here's some tips on how to set yourself up for debt payoff success.
- List out your interest rates.Research shows that more than one-third of us don’t even know our credit card interest rates, so let’s start there. Check your latest statement and pinpoint your interest rate for each and balance you carry. This will help you strategize where your checks should be going first.
- Choose a payoff method.Ask yourself, are you more into snowballs or avalanches? The avalanche method of paying off things focuses on the high-interest debt first and it will help you pay less interest in the long run. On the other hand, the snowball method gives you a bunch of small victories by paying off your lowest balances first. It might not save you money, but it will give you a confidence boost.
- Never miss a payment.When you start chipping away at your debt, make sure you’re paying on time, every time. Even if it is just the minimum payment. Missing a due date could mean late fees and up to a 30% increase in your interest rate. Two words for all you forgetful folks out there: automatic payments. They just might save you thousands.
Get more advice on clearing your debtHERE.
Source:LifeHacker