Dealing with debt feels a lot like Ben Affleck dealing with J-Lo. 😩 You're tired, sick of the hold it has on you, and you wish you were somewhere else. Anywhere else, actually. 🪐
If you're staring at a mountain of debt, have no fear. 🏔️ We have some quick tips to make the journey less Ben Affleck and more…Travis Kelce? Sorry, our debt tips don't come with a multi-billion dollar girlfriend. Just being honest! 😺
Here’s Five Fast Facts about paying off debt:
- 🌈 The More You Know - The first thing to do on your debt payment journey is to size up your situation. Know your debt balances and compare them to your budget. This will help you understand how much you can pay and what payments to prioritize. Getting clear on your current income and expenses determines how much you can put towards debt and whether or not you may need extra assistance.
- 🏂 From Snowballs to Avalanches - After you figure out how much you can throw towards your debts, come up with a repayment plan. Through the snowball method, you'll make minimum payments on all debts and make extra payments on your smallest debt. Once that's knocked out, move on to the next smallest, and so on. With the avalanche method, you'll put extra payments towards the debt with the highest interest, saving you big on interest charges over time, and work down from there.
- 🐖 Penny For Your Thoughts - At the risk of sounding like your nagging mother, how's that emergency fund doing? Although it might seem silly to save extra money when you're paying down debt, an emergency fund is a must-have. Unexpected bills, medical emergencies, and job losses could throw a wrench into things. Having emergency funds prevents you from missing payments or going into more debt.
- 😅 Sweet Relief - If you're in over your head, don't fret my pet. If you have multiple debts, consider debt consolidation to make things easier. When you consolidate your debts into one balance, you'll have a single monthly payment instead of several. If you're having trouble affording your payments, consider working with a debt settlement company like National Debt Relief or Freedom Debt Relief. These companies negotiate down debt balances and reduce how much you owe. NOTE: using a debt settlement company significantly impacts your credit score, but the hit is temporary.
- 👬 The Buddy System - No one said you had to tackle debt repayment all by yourself! Having a good support system in place is a must. Lean on friends and family members for things like carpooling and sharing bulk groceries to save money. Check out the Consumer Financial Protection Bureau for budgeting tips and to use their free debt repayment calculator.
🔥Bottom line: Having a ton of debt is a huge Debbie Downer. Whenever you start feeling too Ben Affleck, remember there's nothing to be ashamed of! While you're scheming and plotting your escape from debt mountain, why not consider your overall financial wellness? It's never a bad time to make new goals and tackle them like the boy or girl boss you are.
Got a lot of debt? How are you managing it?
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