November 29th, 2019 | Updated on June 3rd, 2021
Borrowing a sum of money may or may not be an easy process. But paying it off is the most difficult part of doing it. No matter how financially secure you are, chances are you would want to get rid of it as soon as possible.
However, it is easier said than done. It takes control over your emotions and some discipline to shake off debt from your shoulder.
Books, as well as the virtual world of the internet, are replete with valuable suggestions on how to do it. The majority of those sources underline the fact that clearing an outstanding debt isn’t a hard nut to crack.
Though it may not be as simple and easy as you would read it in many books or on the internet, it isn’t impossible either. All it takes is adherence to some simple rules.
Are you looking for ways to get rid of debt? If yes, then you’ve come to the right place. This post will list some tried and tested ways by which you can get relief from an outstanding amount of money that you either owe an individual or an entity.
Know Your Debts
The very first thing to get free of your debts is to know your debts and to understand it from the core. You should be well versed in all your debt terms and conditions to handle such situations.
There may be different types of debts that you may have accrued; you need to take note of all of them.
Figure Out Your Outstanding Amount
Before tackling your debt, you need to find out the actual amount of money that you owe to your creditors or lenders. This is easy.
Depending on whether you have borrowed the entire amount of money from one or several entities, prepare a list.
In case multiple entities have lent you money, write down their names and the amount you owe to them separately on a piece of paper.
Alternatively, you can also make use of various digital tools that are available online. You can either choose to go with free or paid tools, depending on your preferences and budget.
Given the fact that it may be hard on you to do everything alone, think about involving others, possibly your spouse. Remember that a piece of workload shared is a piece of workload halved.
Work Out A Plan To Clear Your Debt
Once you have written all your debts in paper and pen, you need to plan out how you are going to settle it down.
After noting down the details of your debt, the next way forward for you to deliberate upon a solid plan to repay it. This can take some time but you will be able to figure it out with little patience and introspection.
You do not need to burn your midnight in thinking about how you can pay all your debts at a go. Don’t even think of it as it is virtually impossible. Instead, focus on how you can pay it in installments or EMIs per month.
There’s no hard-and-fast-rule about it. You can choose your way based on what suits you the best.
If you already have a sum of money that you wish to pay every month on your mind, then make use of a debt repayment calculator to find out how soon you can get rid of your debt by paying your loan at that rate. Have a budget on your mind to manage your money.
As far as possible, think about adhering to it. Also, do not forget to be realistic while deciding on the amount of money that you would pay every month to relieve yourself of your debt.
Take Effective Steps To Prevent Your Credit Score From The Nose Diving Effect
Whenever you take a loan and fail to pay it off on time, it is your credit score that receives the maximum blow.
Your credit score is the identity of your financial credibility to your lenders. You would hardly find one who would lend you an amount of money without studying your credit report.
Given the fact that a credit score in red can make things complicated for you for obtaining a loan in the future, you may want to try out every possible step to keep it in green. Paying your monthly installments on time can help it stay on course.
If at any point in time, you figure out that paying off your debt via a simple repayment plan cannot help you do this, consider obtaining an online loan from Personal Money Network.
Browse through its various loan options to shortlist the online instalment loans that tick the right boxes of your requirements.
As Far As Possible, Try To Diminish The Rate Of Interest On Your Debt
Alongside making efforts to keep your credit score on track, also take effective steps to reduce the rate of interest on your debt as much as you can. This will help you swiftly clear your outstanding debt in a relatively shorter period.
There are many options to refinance or consolidate your debt. Choose the option that you feel is best for you.
Try Cutting Down Your Expenditure And Think Of Increasing Your Savings
Spending less and saving more is your best bet to make enough money for paying back your installments every month.
Deliberate upon your options to make extra money. Any extra amount of money that you can earn can come in handy for easing the burden of debt.
Closure
The payment of debt becomes a necessary evil after borrowing money from a lender. Though it may seem easier on the surface than it is in practice, you can make it possible by implementing the aforementioned golden rules into practice.
Follow these rules with your head and heart together, and you will have yourself to thank for this move later.
