Credit Cards

Is debt stressing you out? Here is your 4 point payment plan

Image Source: Getty Images

Getting rid of your debt may be easier than expected.

Key points

  • Consumers accumulate debt for a variety of reasons.
  • If your debt is taking a toll on your mental health, it’s time to make a plan to eliminate it.
  • The first step is to stick to a budget.

Some people end up in debt because life doesn’t go their way: They lose their job the same month their car breaks down, and they end up in the ER with a big bill. Other people end up in debt because they spend too much or are pressured to spend money they can’t afford (think destination weddings).

No matter why you got into debt, that situation could end up being overwhelmingly stressful for you. And that’s not healthy, financially or mentally.

If your debt is wreaking havoc on your well-being, it’s time to address it before it causes more damage. Here’s how to do it in four steps.

Step 1: Get on a budget

Having a clear idea of ​​what your monthly bills look like should make it easier to cut back on spending and create more room for savings—savings you’ll use to pay down your credit card balances. Make a list of your various bills and find out where there is room to trim the fat. That could mean canceling cable TV service for a few months or skipping your weekly Friday night dinner at a restaurant with friends.

Keep in mind that the budget changes you make don’t have to be permanent. You just need to keep them in place until your debt is gone.

Step 2: Determine which debts are costing you the most

It’s a good idea to pay off your debt in order of highest interest rate to lowest. If you owe money on multiple credit cards, rank them from highest interest rate to lowest so you know which ones to tackle first.

Step 3 – See if consolidation is an option

Consolidating your debt could make it less expensive to pay off. And also, it could be good for your perspective.

Imagine that you have four different credit card balances that you are juggling. That can be a lot mentally. If you can consolidate those various balances into, say, a single personal loan, it might make that debt easier to manage. Also, you may get a lower interest rate on that personal loan than what your credit cards charge you.

Another option is to consider doing a balance transfer. You’ll often enjoy a 0% introductory rate if you go this route, which could make it easier to get out of that hole.

Step 4: Take steps to increase your income

The more you can increase your income, the sooner you can get rid of your debt. If there are opportunities to take extra shifts at your main job, ask for them. And if that’s not an option, consider getting a side job, either doing telemarketing work from home or taking care of people’s pets on weekends to earn money.

A large debt load could really get you down. If that’s the situation you’ve found yourself in, follow these steps to get out of it as soon as possible. Doing so could really do wonders for her prospect as well as your wallet.

The best credit card eliminates interest until 2023

If you have credit card debt, transfer it to this top balance transfer card locks you in with a 0% introductory APR through 2023! In addition, you will not pay an annual fee. Those are just some of the reasons why our experts rate this card as the best option to help control your debt. Read our full review free and apply in just 2 minutes.

Related Articles