Paying down debts is crucial for reaching a healthy financial status. However, finding the right strategy that fits your lifestyle and money habits can be quite challenging. For that reason, Syndeo Group – the leading accounting firm offering the ultimate financial assistance services in Brisbane – has decided to share some great ways to clear debts and reach your financial goals.
Top 4 Ways for Clearing Debts
1. Combine Debts into a Single Loan
Taking all your monthly debts and combining them into a single loan with a low interest rate is called debt consolidation. If the equity of the property you own is high enough, you can refinance your home loan to combine your other debts into your mortgage. By doing this the monthly interest you pay will be reduced and can help you clear pay down debts more quickly. Plus, it will be easier for you to keep track of how much you owe and save lots of time on managing multiple accounts.
2. Use a Balance Transfer Card
Another great way to say goodbye to debts, according to every experienced accountant, is using a balance transfer card since many credit cards offer 0% interest from an existing credit card, but for a limited time. Once this time finishes, the remaining balance on the card will convert to a standard rate. Hence, if you have a temporary debt to pay down and enough income, this could be the perfect strategy to avoid dept growing and terminate the debt within months.
3. Save Money with the Avalanche Method
Using the avalanche method is yet another strategy for having a healthy financial status. Applying this method means that you should focus on paying off as much as possible with the highest interest rate. In other words, you should redirect any extra money you have towards making extra payments on the balance on each loan or credit card while continuing to pay the minimum monthly interest rate across other debts. That said, you will limit the amount of interest you pay and save money.
4. Take the Snowball Approach to Keep Motivated
Finally, since paying off debts can be challenging and frustrating, a little bit of motivation boost is what everyone needs in such a situation. According to professional accountant firms, like Syndeo Group, clearing even the smallest debt makes clients satisfied and motivated for working towards their other financial goals. Therefore, use the snowball approach to manage debts, one at a time, and direct extra payments towards your smallest debt first. And, once you clear that one out, continue to the next smallest, and so on. Having a win under your belt will keep you motivated for sure!
The bottom line, being in debt can definitely wear you down. Luckily, with the above-listed strategies, you can easily pay down your debts. And, in need of expert financial assistance, don’t hesitate and contact the best Brisbane – Syndeo Group.
