Is there a way to quickly pay off debt? 8 Although that does not mean you can pay off overnight, this method is a way to pay off a planned debt. That way, the debt can be paid off within a certain deadline and not protracted.
Having a debt is certainly not pleasant. Life can be uneasy and finances can be burdened. The longer you have debt, the interest can increase, future plans are delayed, and your daily activities can be disrupted.
Therefore, you must seriously look for solutions to pay off debt and apply it with discipline. To start the initial steps in paying off your debt, follow the quick ways to pay off the debt below.
Record All Debt
How to quickly pay off debts you can start by recording all the debts that you have. Get to know your income well, as well as expenses and debts that you do. Therefore, take the time to remember and record the debt that must be paid.
At the same time as keeping track of debt, you can also fix your budget and monthly expenses. In addition to increasing income, you need to manage your monthly finances well so you can have more funds to pay off debt.
So, plan your expenses every month as well as allocate money to pay debts. Adjust your expenses so that you can budget money to pay in installments or pay off debt.
Determine Priority of Debt to be Paid
Want to quickly pay off debt? Determine the priority of debt that must be paid off if you have more than one debt. To be able to know which ones should be assigned, you need to do a data collection.
Simple data collection does not only cover the debt they have and the amount that must be paid. Also note the interest charged (if any), the due date, and the type of debt (good debt or bad debt).
Good debt is debt that can increase income or provide other benefits for your life. While bad debt is a loan that can not increase wealth or standard of living for a long time.
From the above definition, you can group debts that you have and determine priorities. It is best to pay first for bad debt and start with the debt that has the highest interest.
Remove Barriers to Paying Debt
As mentioned, dealing with accumulated debt not only has to add money, but it also changes spending habits. If expenses can be managed properly, you can save money. Money from savings can then be allocated to pay debts. Well, what savings can you do? This is among them.
Press Expenditures
You need to evaluate all daily and monthly expenses. Stop eating too much and unnecessary shopping. You can also save money from stopping small expenses, such as eating out or subscription service fees.
Use the Autodebet Service
Pressing debt makes you have to be hard with yourself. One quick way to pay off debt that you can do is to separate the money to pay the loan immediately after receiving the salary. Use the autodebet service if deemed necessary.
Planned Expenditures
Spending in one month sometimes many unplanned. However, in order to be able to repay debts every month, you need to plan money out. Look at the calendar and note what expenses are needed besides basic needs, such as money to buy gifts or attend a wedding.
Use Emergency Funds
Have an emergency fund? If your debt situation is in an urgent situation, an emergency fund can be used. However, if the debt exceeds the total emergency funds you have, do not use all of it to pay off the debt.
Emergency funds are ideally owned by each person depending on the amount of expenditure made every month. However, certainly, prepare three to six times the expenditure for emergency funds for those of you who are not married.
Then, six to nine times the expenditure for those who are married and do not have children. Then, nine to twelve times the expenditure for those who already have children. The total money can vary and if you can save more, it is better.
One of the advantages of having an emergency fund is that you can certainly use it to pay off debt if the situation is urgent. Paying debt faster is certainly more profitable, less interest must be paid and your finances are not burdened for a long time.
Receivables
Besides debt, perhaps you have ever lent money to someone else? Now, it’s time to record the accounts you have. Data on the amount of money you own to other people and when the money is returned.
Ask your friends or family carefully about payment of receivables and whether it can be accelerated. If it can be paid within the month, the receivables can add funds to pay debts.
Better yet, if all the receivables can cover the total debt you have. So, emergency funds do not need to be used and the debt can be paid off immediately. Your finances will not face significant problems.
Add Income
Another quick way to pay off debt is to increase income. Able to work, side job or from the business you do. Increased income will certainly make it easier for you to allocate money every month.
Funds to repay loans can be provided without disrupting monthly expenses. In addition, there is more money you can budget to pay off debt.