Be Free From Credit Card Debts
Many Americans today depend on credit cards or other types of loans in order to survive. Buying a car, purchasing a home, going to college or even paying for monthly expenses are all financed. If you are one of the millions of Americans who lives from pay check to pay check maybe you should consider turning your life around.
Paying off your loans early will save you money and help you live a much happier and stress free lifestyle. There are many techniques to pay off your loans early and different financial experts will argue one way is better than the other.
Is Paying Off Debts Worth The Effort
Once you are with less debt to income balance your FICO credit score will rise, and you will get better interest rates from all the lenders. Many people do not know but even a small raise in their credit score, can save thousands of dollars from the mortgage loans.
Paying debts on time mean that fixing any credit report will be easier than you think. Here are a few techniques you can use to help you down the road to financial freedom.
The Road To Debt Free Life
A common way to approach debt freedom is to use the snowball effect. Pay only the minimum payments on all loans except one. Pay all you can on that single loan until it’s paid off. Move that money to the next loan and continue the snowball effect. Each loan paid off will give you a larger amount of money to pay on the next loan. The snowball will get bigger and bigger each time.
Two Strategies To Be Debt Free
There are two ways to implement the snowball effect of debt freedom. The first is to pay off the lowest balance first. Small balances will be easier to pay off and keep motivation levels high. A big advocate of this method is financial expert Dave Ramsey.
A second approach of the snowball effect is to pay off loans with the highest interest rates first. Many financial experts argue this will save you the most money because you are knocking out high interest rate loans.
Fast Debt Payoff Solution
Another option for quicker debt payoff is to use a debt consolidation. Many professional debt consolidation companies can consolidate all your debt into a single monthly payment. Your monthly payment will be lower and often times you can get a lower average interest rate than you had.
A great way to start any debt payoff method is to pay a large chunk of cash down on the debt when you start. Many people clean out the attic and have a yard sale with unwanted items. It is possible you may earn enough money with your extra stuff to pay off your first debt immediately. Wouldn’t this be some great motivation!
You have to understand that in order for any of these debt payoff methods to work there has to be one common factor. You have to stop spending more money than you make. If you are in a position where this is not possible with your current job, you may have to look into other part-time work until the debt is paid off.
Look around your house, how many things around you do you really NEED? People with debts are usually those who get tempted to buy things on ‘sale’. If you are such a customer, who buys faster than he earns the money to pay for it, than you may need to avoid shopping trips to mall.
Personal Debt Managment
No matter which technique you choose you have to stay focused on the overall goal. Keep thinking about how happy your life will be once you are debt free.
‘Poor’ people spend their free cash on things to buy, to feel better, and because of this they have less money to pay back their loans. Once you will pay off most of your debts, you will have more free funds for investing, and this is the way the ‘rich’ people make their money.
Debt can be a nasty monster that can destroy your life if not controlled. Take control of your debt and pay off your loans early. Reduce the stress in your life and get ready to enjoy your golden years in retirement.
So What is The Next Step?
If you will do nothing.. don’t expect anything to happen.
Every week you are wasting money.. sending dozens of dollars to the rich credit companies, who relay on you to keep doing NOTHING.
If your score is below 700, you might want to do something about it – get this ‘Credit Repair University’ which will save you money and time.
Yes, you might need to invest a small sum to get a grip of things.. But if you think education is expensive.. try ignorance..
You are probably paying thousands of dollars per year in fees and interests to credit companies which could be going straight to your pocket.
So do your math… and take action NOW.