Most of us have some personal debt that we wish to be rid of. It can be difficult to come up with a considered plan that will actually be effective and to help us pay off our debt in a way that is suitable to our current lives, as well as our future debt free selves. There are a number of ways in which you can approach your debt, helping to free your life from the shackles of repayments, without going nuts in the process. Let’s take a look at a few different tips to help you overcome the mountain of personal debt and come down the other side a free person.
A Mortgage Isn’t the Be All and End All – A lot of young people think that there is no chance of them easily getting on to the property ladder, but they are also constantly being told by the older generations that by throwing money at renting their homes they are wasting money. This isn’t necessarily true. If you have personal debt, why tie yourself down to a much larger, and longer, debt in a mortgage. Instead, renting should be viewed through a much more relaxed prism. Renting provides you with the flexibility of taking up an exciting job prospect elsewhere, without having to sell your home. It also allows you to forget about the worries of maintenance costs as this is down to your landlord. Before you have decided where (and potentially who with) you want to settle down, renting makes most sense.
Have Multiple Credit and Store Cards – This might seem counter productive in terms of removing your personal debt but in terms of helping you build a positive credit score and history having multiple credit cards is a big help. Of course, this only works if you are religiously strict about paying off the balance on each card, each month. One tip that helps people build a good credit score is to use your credit card to pay for your groceries each month, having the cash ready and available to pay off the balance come the end of the month.
Make Small Debt Payments Disappear Quickly – It is so hard to stay motivated when you are paying off a large amount of personal debt. If you have multiple debts that all require repaying each month it is disheartening to see them all roll on into the future. One way to stay motivated and to witness real progress is to focus on paying down the smaller debts that you have active, even if that means leaving the higher interest, and larger, debts active for a little longer. This is because psychologically it is advantageous to remove as many debts as possible, so that by the time you are left with one larger debt to pay off, you know you can achieve it, as you have already rid yourself of 2 or 3 other, smaller debts.
Carefully removing your personal debt takes courage, dedication and a thoughtful process that you can stick to. Paying off small debts, such as monthly credit card statements and short-term loans from reputable payday loan providers can help you build up a good credit score.
