Our finances are a huge part of our lives. We go to work to make a living. There are savings goals that we put in place to help us with life events. We borrow money when we need to, with the full expectation that we will pay it back. However, sometimes we don't manage to pay it off and it can turn into unmanageable debt. With the cost of everything going up, it can be hard to get your head around your finances, especially when there doesn't seem to be much left over after paying the bills. Let's look at the best way to save money and pay off debt.
Make this a priority
The best way to save money and pay off debt is simply to begin. This has to be a priority. In order to organise your future finances, you need to make this a priority. That debt needs to be paid off and those savings need to grow. All whilst you are paying your bills and keeping on top of other outgoings. It could be that you take a second job to help pay off this sooner. It might be that you look at the things you are currently paying and decide to cancel subscriptions and change to more affordable providers. You will need to make decisions about where you want your money to go. This will be saying no to some things and changing those habits. In order to succeed with the best way to save money and pay off debt, you need to make this a priority.
Focus on the highest interest first
Look at how much debt you have. You might have it with one provider or there might be different loans from a range of different places. Write them down. Physically get a pen and write down what you owe, including the interest rate on each bit of debt. Then order them from highest interest rate to lowest. The one that is growing the fastest month after month is the one with the highest interest rate. So this is where you should focus your attention. It might be a smaller amount, however, it is growing quicker than your other debt. This is where your attention should be. Work on the debt with the highest interest rate and once that one is sorted, move to the next. This is how you make the best use of your money in order to pay off your debt quicker, without accumulating even more.
Could a 0% card help?
Sometimes you might be able to get a 0% credit card. This will give you a credit limit and there will be no interest added for a certain period of time. It could be 3 months, 6 months or maybe up to 18 months. Could you use this 0% card to pay off your debt, leaving you with that credit card to pay off? This would give you an exact amount that you know you need to pay off before the 0% interest ends. It isn't growing month on month, the payments you are making are actually lowering how much you owe. This is a good idea if you are able to get a 0% card, but be sure to make a note of when this 0% ends.
Start saving
When you have paid down your debt, you need to start saving. Savings will help you in emergencies further down the line, rather than having to borrow money and getting yourself into debt all over again. Savings can help us in times of trouble and also build up to pay for holidays, school shoes, weekends away and our future. You might be living in the here and now but savings can help your retirement plans. Interest rates are important here too because you need to make sure your savings are in the best possible great to grow. Make your money work for you!
Get on top of that debt, work on the highest interest first and start relieving your shoulders from the stress of owing money. Then you can use the money you would have been using to pay off debts to build yourself a savings fund. Find the best way to save money and pay off debt that works for you an start doing it.
