How To Repay Debt Faster
For the majority of Americans, debt is a lingering cloud over their finances. In 2021, the average person in the United States carried $93,000 in consumer debt. Even with a new job, savings, and relative financial comfort, debt remains overwhelming — especially for those without solid plans for how to repay debt faster. Whether you’re currently working to pay down debt or haven’t settled on a plan to tackle debt that works for you, here are a few steps to consider if you’re figuring out how to repay debt faster.
Strategies For Repaying Debt Faster
You can’t begin to figure out how to repay debt faster without knowing exactly how much debt you have. Sure, you may have a general idea, but it’s important to gather all of your debt sources, noting exactly how much you owe, the interest rates for each, and how much time is left to pay each one off. From there, it becomes much easier to see how to repay debt faster.
Pay More Than The Minimum And More Frequently
Depending on your debt total, these approaches may not be for everyone. But perhaps the best plan for how to repay debt faster is paying more of it than you usually do to decrease the total amount owed as well as save on interest.
Check with the specific lender to see if they allow extra payments monthly and that they will go toward your principal.
Paying more than once a month also is a great way to lower the percentage that is being used of your available credit, a figure called the balance/utilization ratio. Lowering that ratio is a fantastic way to increase your credit score.
Target The Most Expensive Loan First
Chances are that your highest interest rate is your most expensive loan. Paying off that one first allows you to decrease your overall debt and interest. This is called the “avalanche method” of how to repay debt faster.
From there, you go on to your next most expensive and then the next, and so on until your debts are completely paid off.
Or Start With The Least Expensive Loan First
Alternatively, there’s the “snowball method” of debt repayment: paying off the smallest balance and going up from there through your most expensive loans. As your balances are paid off, it makes the next expensive loans easier to tackle.
Get A Personal Loan With A Low-Interest Rate
Many find that a good way to pay off your debts quickly is locating a personal loan for help — just make sure that it comes with a low-interest rate. A rate that’s 4% should be targeted, helping you save more money as time passes and making it easier to clear your debts faster.
Another plus is that borrowing through this method is usually pretty expensive.
Put Your Credit Cards Away
If you, like many, find that most of your debt stems from credit card use, take a credit break if possible. By stopping credit card use, your debt balance will go down, your credit utilization will improve, and you’ll easily keep your spending in check.
In addition, take an honest look at your monthly spending and see if there are areas to seriously cut back on. There will be some spending areas you can’t make immediate changes to, including rent and gas, but there will likely be others that are more “wants” than “needs.”
Lower your spending on “wants” first and then move on from there.
Consider A Payday Advance
Sometimes you need a little extra assistance when figuring out how to repay debt faster while still making ends meet. A payday advance is designed to help with such financial emergencies as being able to cover rent and necessities while still paying down debt.
A payday advance can also help you recover quickly from an unexpected bill, such as a trip to the emergency room, vital home, and car repairs, or last-minute but necessary travel.
It’s a short-term loan offering relatively small amounts of cash to help you financially between paychecks.
At Carolina Payday Loans, Inc. it can take as little as 30 minutes to qualify for a payday advance of up to $550. And you can start the quick process online.
On our homepage, fill out the payday advance inquiry form with some basic information. Once submitted, one of our loan representatives from the Carolina Payday Loans, Inc. location nearest you will give you a phone call to discuss the requirements for a payday advance and guide you through the rest of the process.
Once you qualify and are approved for a certain payday loan amount, you get the cash you need that same day or the next business day.
Get A Payday Advance Today
When you’re focused on how to repay debt foster, a payday advance is an option to address an unexpected financial emergency that threatens to derail your debt elimination plans. Get started today online, give us a call, or visit us at a Carolina Payday Loans, Inc. location near you.
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.