{"id":360301,"date":"2021-12-03T10:15:23","date_gmt":"2021-12-03T17:15:23","guid":{"rendered":"https:\/\/www.creditrepair.com\/blog\/?p=360301"},"modified":"2022-01-20T20:32:39","modified_gmt":"2022-01-21T03:32:39","slug":"best-way-to-pay-off-debt","status":"publish","type":"post","link":"https:\/\/www.creditrepair.com\/blog\/education\/best-way-to-pay-off-debt\/","title":{"rendered":"15 best ways to pay off debt"},"content":{"rendered":"\n
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Disclosure regarding our editorial content standards<\/em><\/a>.<\/em><\/p>\n\n\n\n

When you\u2019re struggling with debt, it\u2019s hard to know where to get started paying it off. Whether your debt is from credit cards, student loans, a mortgage or any other source, you can benefit from learning more about the best ways to pay off debt. <\/p>\n\n\n\n

Getting out of debt can improve both your financial health and your peace of mind\u2014and it will also likely give your credit score a boost. While there\u2019s no magic spell to remove debt from your life, there are realistic ways to start tackling it one day at a time. <\/p>\n\n\n\n

Read on to get some inspiration for making small changes that could make a big difference in your approach to dealing with debt. <\/p>\n\n\n\n

1. Pay more than the minimum balance<\/h2>\n\n\n\n

Getting a handle on debt starts with making payments that outpace interest. It can be tempting to simply pay the minimum balance on a credit card bill<\/a>\u2014after all, that eliminates late fees, at least. But a credit card\u2019s annual percentage rate (APR) is generally quite high, which means that you are probably not making a long-term dent in your debt if you don\u2019t pay more than the minimum.<\/p>\n\n\n\n

For example, if you have $1,000 in credit card debt on a card with 20 percent APR, it would take more than 10 years to pay off the card with a minimum payment of $25\u2014and you\u2019d rack up almost $1,200 in interest charges along the way.<\/p>\n\n\n\n

Key takeaway: <\/strong>Paying the minimum balance likely isn\u2019t the best approach. Putting a bit more toward your debt each month will save you money in the long term by avoiding interest charges.<\/p>\n\n\n\n

2. Make multiple payments each month<\/h2>\n\n\n\n

Although your loans and credit cards only require monthly payments, there are several advantages to making more than one payment<\/a> each month. <\/p>\n\n\n\n

Many credit cards calculate interest based on your daily average balance, so making several payments could reduce your interest charge\u2014even if you actually pay the same amount in total. For example, if you make four payments of $100 throughout the month, your average balance will be lower than if you pay $400 at the end of the month.<\/p>\n\n\n\n

For loans as well as credit cards, making multiple payments can be helpful if you tend to put off paying loans after payday. If you get paid weekly or every other week, you could try applying a percentage of your paycheck to your debt right after you get paid\u2014that way, you\u2019ll prioritize debt payments before any other spending.<\/p>\n\n\n\n

Key takeaway: <\/strong>Making multiple payments can help you build the habit of putting debt payments first, and it may also reduce your credit card interest charges. <\/p>\n\n\n\n

3. Find a powerful payment approach<\/h2>\n\n\n\n

Paying off debt sounds simple enough, but there are a few different approaches you may want to take. While some approaches will save you money in the long term, others may give you the emotional boost required to keep pushing toward your goal of being debt-free.<\/p>\n\n\n\n

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Here are the most common approaches to paying off debt<\/a>:<\/p>\n\n\n\n