Almost everyone faces some form of debt at some point their lives. Whether it be student loans, a mortgage, an auto loan, or something else – it is very hard to get through life without taking on some kind of debt. Our economy is simply built around it and it’s very hard to avoid, though that would be nice.
Though there are so many people with debt, most people don’t think they have any options when dealing with it.
There are, though, and that is exactly what I am going to let you know about in this post. The following are some of my favorite, top secret ways to save on debt.
Student Loan Debt
If you have student loan debt, like most graduates do, and are looking on ways to save on it, you do have some options.
First off, if you can afford it, consider making extra payments. This will reduce your loan balance and less interest will be charged in following months.
Second, if you have a decently paying job and good credit score, you should look into refinancing your student loans. In short, a new lender will pay off your old loans and give you a new one with a lower interest rate, saving you thousands over the life of your loan. Be sure to research the pros/cons of it before signing any dotted lines though!
Credit Card Debt
Credit card debt can be very nasty. With interest rates typically ranging from 15% – 30%, if you fail to pay off your balance, you will be facing some hefty interest charges.
What is one of the best ways to avoid these high interest charges?
Refinance and consolidate your credit card debt with a personal loan! Some lenders offer personal loans with interest rates as low as 3%. Most people can expect to pay somewhere closer to 10%.
Though this is still high, it is nowhere near the interest rates on credit cards, and refinancing your credit card debt to a personal loan could save you tons of money.
Like student loan debt, one of the best moves you can make for your mortgage is to make extra payments if you can afford it. This will help you save in interest over time, and when you’re dealing with such high amounts of money, it can really make a difference.
Another common tactic used by consumers is to refinance their mortgages. When you first receive you mortgage you may have little credit history and may not get a great rate. As you build up your credit, though, you should qualify for a lower rate that will save you tens of thousands over the life of your mortgage.
Debt isn’t fun and I’m not sure if there will ever be a time when it will be. There are, however, lots of things you can do to save on your debt. The ideas listed above are just a few of the available options. No matter what your situation is, be sure to thoroughly research your options and figure out what is the best for you.
How have you saved on your debt in the past? Any interesting strategies that people don’t take advantage of? Let me know in the comments below!