Sometimes life can have a way of dealing you a few blows. In addition to unexpected costs, sometimes you take on debt for others, or an emergency arises. If you have several credit cards, you can get overwhelmed when trying to figure out what your next steps should be. Create a plan, and it will help guide you in paying off your debt and save money in the long run.
Stop missing payments
Payment delays or missed payments can slow down your borrowing but don’t make you fail financially. Over the last few years, there has been a trend toward quicker loan payments. This is because the lenders want their money now, and if they have to wait a while, it might make them look bad and evidence that they are struggling economically. Americans have become more accustomed to instant cash and quick payments, which may cause them to overlook other considerations such as tax due or interest on the debt. The fastest way to eliminate payments delays is to contact your lender directly and make sure you are making regular payments. This will reduce the chance that you will miss payments and keep paying interest on interest. You can also make payments online through methanpaa.com and save yourself time and money by not paying
Use debt Avalanche method
Debt Avalanche is a financial plan that can help you eliminate debts faster through a series of steps. The randomized debt elimination process begins with identifying your high-interest debt (including credit cards, medical bills, or alimony), then uses a validated method to quickly eliminate all balances above a certain amount. Once all outstanding debt is disregarded, you can restart your regular payment schedule.
The way I do avalanche is to pay the minimum payment due to all of your debts, then allocate the remaining to pay off the debt with the highest interest rate.
How do I pay with the Snowball method?
The debt snowball method is a debt-reduction strategy where you pay off the debt in order of most minor to most significant, gaining momentum as you knock out each remaining balance. When the smallest debt is paid in full, you roll the minimum payment you were making on that debt into the next-smallest debt payment. This way, even if you have a lot of small amounts coming in, you won’t be overwhelmed by them and will be able to pay down your principal more quickly. For example, let’s say you have a $10,000 credit card debt, and you want to pay it off by paying off the largest balance first. You could start with a $1,500 payment toward that goal (an amount that grows over time as you pay down each debt). Next, pay down the next lowest balance, which rises to $2,500; then the next one down, which grows to $3,500; and so on until
Pay your debt by doing a balance transfer
One way to get out of debt fast is to transfer your balance to a new credit card. This can help you pay down debts faster than paying cash in the short term, and it can also benefit you in the long run because it helps drive up your credit score. In general, transferring a balance from one card to another will lower your total outstanding balance on that card by the transfer amount. It will not affect your credit limit, however, which means you can still spend as much money as you want on that card without having to pay any additional fees.
Pay your debts by getting a Personal loan
One way to speed up the process of getting out of debt is to get a personal loan. Of course, this assumes you’re in good enough financial shape to qualify for conventional loans, which borrowers typically are not. You would apply for the loan through an alternative lender, which some financial institutions use to speed up the paperwork for traditional loans. Suppose it looks like you have enough money to cover the total amount. In that case, the alternative lender will contact your lender to set up an appointment with an accountant to review your taxes and financial information.
Do Debt Settlement
The debt settlement process is an alternative to bankruptcy, which helps people who have a large amount of outstanding debt and can’t meet their monthly payments. Think of debt settlement as the informal method of paying off debt. It involves contacting your creditors directly to offer a compromise on your existing balance, rather than going to court and potentially paying longer with interest. If you have a lot of debt or don’t have anywhere to turn for help, this can be an effective way to get rid of it quickly without a lot of hassle. It’s not particularly difficult or expensive to start this process, either. Creditors frequently agree to forgive a significant portion of the debt.
Pay-off debts are often slow and frustrating. But you can employ strategies—timed payments, prioritization of payments—that can significantly speed up the process. And the sooner you start taking action to make your payments on time and in full, the sooner your debt will be gone.