Money Management

More Ideas on How to Pay Off Debt

More ideas on how to pay off debt. You know you are ready to so find out some ways to pay off credit card debt and other debt.

Whether it is negotiating with your credit card company or consolidating your debt, It is time to start paying it off.

How to Pay Off Debt - Consolidate Your Debt

Another way in pay off debt, is to consolidate your debt into one lower interest rate loan. Many companies will help you with this.

CUT UP YOUR CREDIT CARDS if you do this. This way of paying off debt pays off your credit cards and many people fall into the trap of using them again. If you run up those cards then you now have a loan totaling what you owed, TIMES 2, as you will owe the same amount on your credit cards again.

If you feel you need help with your debt, then reach out for it. Credit.com is a great company that will help you consolidate and decrease your payments.

How to Pay Off Debt - Negotiate With Your Credit Card Company

Get out your statements and agreements with your the companies you owe. (Use the Debt Schedule on our How to Calculate Debt Page provided in our Personal Finance Tools Section) How to pay off debt

Read the fine print and really get to know what the "games" the credit card companies play. Find out what the interest rate is, what the fees are.

Call your credit card companies and tell them you have been offered new credit cards at lower rates and ask them to reduce your interest rate and your fees.

Many companies will negotiate with you. If they say no, then tell them you will be closing your account and transferring the balance to their competitor that offers better rates. Ask to speak to a supervisor as they may have more authority to reduce your rates. Go for the gold - ask them to cut your rates in half!

Borrow From a Family Member or Friend

How to Pay off Debt Now this is a risky way to pay off your debt. And I don't recommend it unless you have someone that is willing to pay off your debt for you and doesn't expect the money back. That doesn't mean that you don't pay it back, it just means that they don't expect it to be paid back. Borrowing money from friends or family is always a tough thing to do and I have seen it ruin relationships.

With that said, if you do borrow from family or friends, make sure that that you document everything. Create it as a business transaction. Make sure each party knows the interest rates and repayment terms and they should be laid out in a contract. Take the emotion out of it and it may work. (It's also a cheap way to get out of debt as they will usually charge you less interest!)

Use Your Savings to Pay Down Debt

If you have savings that make a lower return then the interest you are paying on your debt, use your savings to pay down your debt. For example, if you are earning 4% on your savings of $10,000 and you owe $12,000 at an average interest rate of 22%, then you are earning a negative interest rate of 18%. It makes more sense to pay down your debt and avoid the 22% interest, then earn the 4% interest.

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