How to Pay Off Debt in 2021: 4 Strategies That Work

If you've ever experienced debt, you know it can affect your entire life. Debt can be intimidating, but there are ways to fight back against it, and take control of your finances once again!
How to Tackle Debt

“Is there life after debt?”

If you’ve ever experienced debt, you know it can affect your entire life. You feel like your paycheck should be made payable to your credit card company, student loan organization, or mortgage broker. Any money left over goes towards food, clothing, and gas — the bare necessities — and even then it seems to be barely enough. Debt can be intimidating, but there are ways to fight back against it, and take control of your finances once again!  Ready to pay off your debt?

Getting Started

The best starting point on your quest to fight debt is to keep track of where your money is going. If you haven’t already, start a budget. List total income, as well as fixed expenses, such as rent, mortgage payments, utilities, and insurance. Next, detail your variable expenses, such as gasoline, groceries, clothing, and entertainment. Once you write these expenses out, you quickly see where your money is being spent. Part of the money that remains should be saved, and the rest should go towards your debts.

Consolidating Your Debts

Your next step should be to combine your debts, so they can be repaid simultaneously. Instead of tackling many different debts, with different amounts and interest rates consolidate them into one payment. This way, your interest rate and payment are consistent (and often lower) and budgeting will be more straightforward. A good option could be a low-interest credit card or debit consolidation loan.

Stick To Your Plan

Now that you have developed better money-handling habits, and have consolidated your debts into one easy payment, resist the urge to use credit. Destroy extra credit cards, and exclusively make payments to continue to lower your debt. The only way to get out of debt is to keep from adding to it! Stick to your new budget, and limit your spending on non-essential items. Follow this debt-defeating strategy and start your journey towards financial independence!

When the time comes to fight against debt, consider how Your Credit Union can help you regain control of your finances.

Take Action

It’s the people who are the heart of the Credit Union with personalized service from friendly staff, loyal members who utilize many cost-saving services, and dedicated volunteers who work to make the Credit Union a success. If you have any questions, stop by one of our three branches or visit our website to learn more about the Credit Union difference!

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