When you fall back on your payments, debt can feel like a sinking feeling. Whether you missed one payment or months worth, try not to panic. Here, at DEXSTA Federal Credit Union we have some helpful tips to help you lower debt.
Debt is very common, in fact, according to the Federal Reserve, the average American household has 4,137,063 in debt. Debt can be a scary thing, but you can get out of it. We’ve compiled a list of easy ways to help you become debt free.
The first step is to get organized to determine how much you owe and to who. Pull together your bills and statements to arrive at an amount for each debt. Also, make a list of your income and expenses to create a budget for monthly spend. This will help to cut back on your extra spending, so you can focus on getting rid of your debt.
Paying more than the minimum balance will help you to pay off the debt, because you’ll pay more than just the interest. Start paying weekly instead of monthly, sometimes it is easier to pay small sums at a time vs. a huge chunk of cash, and it will reinforce your commitment to paying everything off. Doubling your minimum payment could make a serious dent in your debt.
Call your creditors and ask them if they can decrease your interest rate. If another credit card company offered you a lower rate, let them know because they might make an offer. Another solution is to pay off the card with the highest interest rate, and it will help you save money in the long run.
This sounds crazy, right?! Wrong. If you have an amount you genuinely believe you can pay off, you can transfer the balance to another card that has a low balance transfer rate. But make sure you pay it off before the low-introductory balance transfer rate runs out (typically 12 to 18 months) or you’ll be in the same boat.
You don’t have to be swimming in debt for the rest of your life. At DEXSTA, we want to help you achieve financial freedom by improving your debt. To learn more about how you can improve your score and bank simple, please contact us.