Vital Tips to Repay Your Debt and Control Your Financial State

by Penn Ross on 08/29/2013

Image of couple struggling with their debt

While you can throw off the credit card account reminders into the garbage can, that won’t make the debt go away. High interest debts, when left unattended, will gradually spiral out of control and the annual interest rates will keep multiplying. Although you wish that your debt vanished, you just can’t wish it away. Unless you are financially determined, you can’t pay down your debt and secure a debt free life. Hence, you require taking some rock solid steps to get out of the debt burden and protect your credit score. Unlike falling in debt, getting out of debt can take years and will steal your peace of mind until you take the required steps to eliminate your debts. Check out some vital steps through which you can get back on track and safeguard your credit score.

Pay more than just the minimum monthly payments: Firstly, you should break your habit of paying only the minimum monthly payments towards all your cards. Well by this, you shouldn’t stop paying the minimums altogether but you should pay more than just the minimums if you don’t want to incur debt. Although the credit card companies will tell you that it’s okay with making simply the minimum monthly payments but you should know that a few extra payments here and there will certainly help you reduce your principal balance and get out of debt sooner. Don’t be a victim of their selfish game.

Prioritize your bills: The next step to take is to prioritize your bills according to their interest rates. Make a list by placing the account with the highest interest rate on the top and then list them down according to the second-highest, third-highest and so on. This way you can easily be able to list them and thereby take steps to trigger off your debts by paying off the highest interest first and then the second-highest interest rate. This will help you reduce balance sooner and get out of debt sooner.

Opt for a balance transfer: If you have a moderate credit score, you can certainly shop around for a low rate card and transfer the entire balance to that card. The new card will have lower rates and better terms and conditions but you need to repay the entire amount within the introductory period (when the interest rates are nominal) so as to reap its multiple benefits. Read the fine print and avoid being in the black.

Sign up with a legal firm: When you think that you can’t take steps to repay your debts on your own, you may sign up with a legal firm like the companies that offer debt settlement or debt consolidation services. The representatives can take over the responsibility to negotiate with your creditors and convince them about a reduction in the interest rates to facilitate the debt repayment procedure.

Therefore, when you’re wondering about the ways in which you can repay your debts and regain control of your present financial situation, you can follow the above mentioned steps. Get back control on your present financial state and live debt free!

Penn Ross is a financial writer and a blogger. He has profound knowledge on the different financial issues that are plaguing the current economy and he also offers solutions to the readers through his articles. He contributes his valuable posts to different financial communites, blogs and websites. Some topics covered by him are the US debt and the impact on the economic growth, ways in which debtors should rein in their finances, the pros and cons of consolidating debt and many more.

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