5 Simple Ways to Manage Your Debt

You have to face your debt if you want to increase your wealth and reduce stress.  To face your debt, you have to stop accumulating it and implement these 5 simple ways to manage your debt.

5 simple ways to manage your debt

If you are guilty of paying only the minimum amount due, borrowing from one account to pay the other, or taking cash advances from your credit cards, now’s the time to get real about your situation. Getting a grip on your finances will help you qualify for lower rates and raise your credit score.

5 Simple Ways to Manage Your Debt

  1. Stop using credit cards. Consider switching your balances to cards with lower interest rates. Pay off the ones with the highest interest rate first. Only have one credit card with a low-interest rate and use it for emergencies only. Avoid store credit cards…they are a trap to keep you in debt, and they usually have higher interest rates.
  2. Do your research when searching for an auto loan.  Keep your interest rate for your auto loan as low as possible and take the shortest loan term you can afford. Longer terms mean more interest income for the bank. If your auto loan has a high-interest rate, contact your lender to see about refinancing it to a lower rate.
  3. Know the difference between good and bad debt. Good debt is for things that will appreciate, such as a mortgage. Bad debt is for something that will depreciate, like an auto loan. Keep your debt payments below 30% of your monthly income. Check your credit and credit score for free at AnnualCreditReport.com.
  4. Understand your student loans. Check out The Public Service Loan Forgiveness Program to determine if you are eligible for loan forgiveness.  This program may forgive your federal student loans if you have been employed for at least 10 years in public service and have made 120 qualifying monthly payments.
  5. Get help if needed. If you feel you have exhausted all of your options or you just feel like you need some help getting your finances in order, consider reaching out to a credit counselor. The National Foundation for Credit Counseling can help you find someone in your area.

Get Started Today!

When you begin implementing these 5 simple ways to manage your debt, you’ll experience lower stress levels, and your debt will start to disappear!

What are some steps you have taken to get your finances/debt in order? I’d love to hear about them! 🙂

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4 thoughts on “5 Simple Ways to Manage Your Debt”

  1. I really like this and totally agree! My husband and I went through Dave Ramsey’s Financial Peace University a few years ago. I highly recommend him as another resource. He teaches the same values you’ve stated in this post. Great minds think alike!

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