Debt is a reality for many people and managing it can be difficult. Credit card debt is easy to build up and difficult to pay off. When people add their school loans, medical debt, mortgages, and car payments, the stress to make minimum payments increases. Paying off debt takes money from your savings and slows the process of reaching financial goals. Fortunately, there are steps you can take to manage your debt.
Make a List
As stated by a credit repair expert, before you can manage your debt, you have to understand exactly how much debt you have. The only way to do it is to make a list and take a good look at how much you owe. When you put your debt on a piece of paper and really look at it, you can see how serious your debt actually is.
When you make a list of your debt, you can also see how much you have to pay each month and decide which debt you can pay off the fastest.
Determine Your Debt Expenses
After you make a list of your debt, you can determine how much you have to spend. As you look at the expenses, don’t forget the interest rate you are paying. Your monthly bills should include your current interest rate. Take a look at how much you are paying each month, then compare it to how much interest the credit card companies are charging you.
Make Payments Each Month
To get your debt under control, you must make your minimum payments each month. Otherwise, the credit card companies will charge you a late payment fee. This can be between $35 and $50 per month.
Credit card companies do not mess around with missed payments. As soon as you are one day late, they will add the additional fee. Then, that fee will get added into the total, and interest will accrue on each late fee you earn. Late fees can spiral out of control, so you must make your payments on time.
Double Your Payments If Possible
One way to get your mortgage and car payments under control is to make two payments each month. This does not mean that you pay your total twice. Break up the total into two payments, but pay them before the due date. If you pay half early and half on time, you cut down a little on the extra interest. By setting up two payments in this manner, you can pay off your car or your mortgage faster than if you made one payment each month.
Cut Your Interest Rate
One more helpful way to get your debt under control is to get your interest rates lowered. The only way to do this is to call your credit card companies and ask them for it. While making a call is not a guarantee for a lowered interest rate, it doesn’t hurt to ask. If you do not ask, your credit card companies cannot say yes or no. And, in the current economic climate, credit card companies would rather have you pay back something rather than nothing.
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See ya later,