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Being in debt can be a
very confusing, intimidating, and frustrating situation.
Take a look at some of our tips to help consolidate and
eliminate your debt.
Large amounts of debt can
seem impossible to pay off.
Millions of people are in debt, so you're not alone,
but that doesn't make it feel any better.
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The nice thing is,
there are surefire ways to improve your debt without changing too
much of
your life in the process. Eliminating debt is probably the
best thing you can do for your long-term financial health, and we're
here to give you some ideas on how to do just that.
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Eliminating Debt: How
to Get Out of the Hole
Regardless of the kind
of
debt you have, it's possible to get out even if
your income is
lacking a little bit. That said, different forms of debt warrant
different solutions. Generally, the way to approach paying off your
debt by looking at the various interest rates and penalties that
you're up against.
Many people have some
credit card debt coupled with a heaping mound of student loan debt.
It's not uncommon to have two sources of debt that need to be repaid
with varying interest rates.
In those instances,
you should look at the interest rates and projected growth of those
loans over time and compare them. Look to see if it's smarter to
repay one loan first, rather than paying each gradually and allowing
two interests to pile up.
It's a good idea to
map out the growth of your debts because it provides you with a
specific look at the situation. When we can't see the specifics, our
anxiety mounds and we're less likely to take action.
Once you have that map
laid out in front of you, you can reference it against your actual
life and financial situation. This way, you'll know whether you can
conceivably make the payments you have to, and adjust your repayment
plan if those payments aren't possible.
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Consolidation
One of the most
effective
debt solutions for people with multiple loans is called
consolidation.
Basically, consolidation means taking multiple loans of different
interest rates and paying for them all at once with one large loan
that has a smaller interest rate. So, instead of three loans with
rates of 6%, 9%, and 11%, you have just one loan with a 5% interest
rate.
Additionally, you skip the various repayment dates, late fees, phone
calls, and emails concerning your bills. It's simply a way to make
all of the factors of your debt a little more streamlined and
cheaper in the long run.
Consolidation
shouldn't be taken lightly, though. It's important to look at all of
your options, examine the monthly costs and how they'll run their
course, and even speak to a financial planner if you can.
It's possible to be
taken advantage of when you're trying to consolidate, so make sure
that you're doing the absolute smartest and safest thing.
All that said,
consolidation can take years off the repayment plan of your loans
and save you from throwing money away to excessive interest.
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Want to Get Debt Free?
Eliminating your loans
is your goal, and we're here to help you get there. There are a lot
of things that a person can do to chip away at those loans and make
strides toward financial freedom.
If you're interested
in more financial tips and tricks, visit our site for the
information you need.
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