It is no accident that they call it drowning in debt. When you get in over your head with high interest rates on loans and credit cards, you might start to feel panic—like there’s nothing you can do to get back on top. But fear not! There are some easy steps you can take to drop that debt faster and options like low-interest pawnshop loans which can help.
1. Kill the Credit Cards
Or, just put them in cold storage. Adding to your credit card debt is like bailing more water into your boat. If you get behind on payments, the interest rates can double overnight. Cash advance loans on your credit card come with a big fee and a higher interest rate, which starts adding up immediately.
While you work out a plan to pay off these budget crashers, take a big plastic container, fill it with water, drop all your credit cards into it, and store it in the freezer. If a true emergency arises, you can still thaw them out, but your impulse credit purchases will be effectively frozen.
2. Bring Back the Budget
It is an oldie but a goodie. Saving money to pay off your debts is almost impossible to do without a plan. Creating a budget can be simple and eye-opening. There are plenty of apps and free programs that can help you do the basics, but all budgets start with this formula:
- Income – Expenses = Amount you can use to pay down your debt
If this bit of math gives you a negative number, you already are spending more than you make. Getting out of debt means you will have to increase your income or reduce your expenses. Personal cash loans can only cover this budget gap for so long.
So, what can you do?
3. Plot a Course that Appeals to You
Looking at the bottom line will get you in the mood to make a plan. Some people turn to debt consolidation to gather all their credit cards and loans into one big pile to pay off at a lower interest rate. However, there are many ways to reduce those outstanding debts without selling them all to a 3rd-party lender. Try these:
- Paying more on your highest interest rate debt. Determine which of your cards, loans, or outstanding bills is charging you the most in monthly fees and interest rates. Attacking this large fish first can give you some fast relief.
- Paying more on the debt with the smallest balance. If you are being picked apart by too many debts, clearing the little fish off your back can let you focus on fewer and fewer targets until the water ahead is clear.
4. Throw Some Luxuries Overboard
Reducing your expenses will give you more money to use in your chosen debt payment plan. Setting priorities and eliminating luxuries you can live without can add up to a lighter load and a faster trip to debt freedom.
Consider bailing on:
- Expensive television subscriptions
- Eating out more than once a week
- Drinking alcohol and soda pop
- Using expensive beauty products
5. Start Treasure Hunting
One of the fastest ways to eliminate your debt is to turn things you have back into money. A fast cash pawnshop loan can pay off a debt with a much lower interest rate. You can sell diamond jewelry or cash-in gold and silver to make a big splash in your puddle of past-due notices.
In New York City, you can bring those valuables down to GEM Pawnbrokers for fast pawnshop loans or a direct sale. Using what you already own to bail yourself out of personal loans and debt is one of the best reasons to call us today.