Simple Ways To Get Out Of Debt (And Stay Out!)

May 25, 2022 | June Mckaig

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Getting out of debt is a commitment but the strategies that you can use to escape your debt are simple. It is all about using the snowball method, making more than the minimum payment, devoting any spare money to your debt, and looking for ways to consolidate or renegotiate your debt.

These are the simple strategies that you can use to get out of debt.

How To Get Out Of Debt

Make More Than The Minimum Payment

If you want to get out of debt, the most important thing is to make more than the minimum payment on any accounts that you owe. You should take a look at your budget and figure out how much extra money you have that you can put towards paying off your debt.

If you only ever make the minimum payments on your credit cards, it will take forever for you to get out of debt. This is because the minimum payment basically only covers the interest that your card has accrued.

If you make more than the minimum comment, you will get out of debt much faster, and you will pay significantly less money in interest.

Use The Snowball Method To Pay Off Debt

A lot of financial advice recommends that you pay off your largest debt first. This can be intimidating, however, and this could worsen your financial situation in the long run. If you are focused on paying off one massive debt and allowing several smaller debts to grow and accumulate interest, you can end up with more debt overall.

The alternative to this is the snowball method. This recommends that you make the minimum payment on all of your debts except for the smallest one. Instead of paying the minimum on your smallest debt, you pay it off entirely as soon as you can.

By doing this, you will be able to “snowball” your way through your debts and pay all of them off faster than you would if you started with the largest debt.

Try Debt Consolidation

Another common tactic that people use in order to get out of debt is to consolidate as much of their debt as they can. One way to do this is with a balance transfer card.

This is a way that you can put all of your debt onto one card with zero percent APR for a specific amount of time. This is usually somewhere between half a year to a year and a half.

The advantage of this is that you can put all of your debt into one place, and you only have one account to focus on, rather than several.

Use Any Extra Money To Pay Off Debt

If you get any extra windfalls, such as a tax return, inheritance, stimulus check, or gambling winnings, you should put this money towards paying off your debt rather than saving it or spending it all on something fun.

You do not have to put all of the money towards paying off your debt. You certainly can split it between debt and your savings or entertainment money. However, you should put at least a significant portion of the unexpected windfall towards paying off your debt.

Negotiate A Debt Settlement

You can also try to negotiate a debt settlement with your creditors. This is a way that you can settle the score and negotiate a way to reduce the debt that you owe. This may be something that you can do yourself, it is also something that you can seek the help of a third-party agency to help you with.

Some problems can come with this though. Some debtors will require you to stop payments while you negotiate the settlement. Stopping these payments can lower your credit score, but you will still have the advantage of getting out of debt more easily.

Getting Help with an Installment Loan

The main advantage of getting out of debt is that you will be able to devote more money to your emergency savings. The problem is that sometimes you will be faced with a financial emergency before you can build this savings fund.

When this happens, one option that you can consider is applying for help in the form of an installment loan from Idaho Title Loans, Inc.

Signature Installment Loan Advantages

There are plenty of advantages that come with applying for help in the form of a signature installment loan from Idaho Title Loans, Inc. These advantages are:

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  • You can get an unsecured loan for up to $1,500.
  • You can get quickly approved in the store.
  • There are convenient locations near you.
  • You can enjoy great customer service.

Final Thoughts

Getting out of debt takes time and effort but the methods that you can use to escape debt are simple. All it takes is a little bit of time, focus, and dedication.

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.

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