Wondering how to pay off your existing debts that are hiking upward with interests and late charges, with this pandemic going on, it may be even harder for those people of less income or people who lost their jobs and have no employment commitment. Your debt is not going to cut out because you cannot earn but this will even make the scenario worse if you can not keep up with the installments.
We’ve got you covered with some tricks and tips to pay off debt faster in a time of crisis:
1. Don’t take new debt:
Although this may sound so crazy and tough for some people who are working hard to cope up with daily lives. It’s a piece of advice not to take new debt that is going to pile up with your existing ones. It will become another burden for you to pay off your debt which attracts a huge amount of interest and other charges. Therefore, try your best not to take up another debt if you want to pay off your older debts faster.
2. Track down your current debt situation:
So, be calm and list down all the debts that you own. Take your pen and paper to note down all the debt details with creditors’ name, location, amount of debt, interest rates, debt period, and other remarks. This will enable you to plan properly to pay off your debts at a faster pace.
3. Make Plans:
Since, you have noted everything related to the details of your debt, better start planning how you are going to pay off. See how much is your income amount and plan accordingly. You can pay off the smaller debts first and also prioritize the debts that have higher interest rates.
4. Pay on time and avoid additional charges:
You see the creditors not only charge interest but also late fees charge, renew charges, and many more. This can hype up your debts. Paying on time and as per the agreed time can prevent you from additional charges that are going to increase your payable amounts.
5. Saving is Earning:
Saving your money is like earning extra money. Avoid impulsive shopping and spending as this will increase your spending but it can be used to pay off your debts if you had saved them later. Make sure to think before you buy anything and evaluate its importance so that you can know if you need something or not. This will prevent your unnecessary spending and can utilize the same amount in clearing your debts.
6. Make extra money:
If you are employed or a student and have less or no income, then why don’t you think of side hustles. You can start tutoring small children around your locality, start an online business, help others, and many more which can help you collect some extra cash which can help to make you extra money. You can search for some new ideas as per your qualifications and strengths.
7. Build an emergency fund:
You can save for an emergency fund to avoid taking on new debt. Try saving some of the amounts that you have while you have money in your hands. If you are a student then you might get some pocket money from your parents, you can save it in a bank account to use it in the time of rain.
There are many locations place you can invest. Investing money is growing your money. You can invest in the share market, IPO, small business, or many more which can grow your money. Don’t invest all your money. Try to invest half of your money which will surely help you in long term.
These are some of the tips that are going to help you to clear off your debts. This may take some time but believe that you will be benefitted from the implementation of these suggestions. Believe in yourself and move at your own pace. Don’t compare to others and try to live a debt-free life.