29% of Americans are worried about their debt. Here’s how to pay yours early

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Full of debt? Here is your exit plan.


Key points

  • New survey finds debt is a big concern among consumers.
  • Consolidating your balances and increasing your income could help you get out of debt faster.

It is not uncommon to find yourself in a scenario where you have accumulated less than healthy debt. Maybe you’ve been hit with a slew of expensive medical bills that your paycheck couldn’t handle, and you’ve had to put them on your credit cards and pay them off over time. Or maybe there was a lot of pressure to spend money while on vacation, and resorting to credit cards was your only choice.

If you are stressed out about your debt situation, you are not alone. A good 29% of Americans are worried about the debt they have accumulated, according to a new survey by Lincoln Financial Group. The good news, however, is that a few strategic steps on your part could help you get rid of that debt sooner.

1. Adopt a strict budget

Keeping track of a budget should make it easier to keep track of your expenses and find ways to reduce them. And that could, in turn, free up money to pay off some of your debt.

Browse your bank and credit card statements for the past 12 months to see what your average monthly bills look like. Remember to factor in any bills you might pay quarterly or annually, like property taxes or insurance premiums. Then compare your expenses to your income and see if there is room to cut back so that you can squeeze more money out of each paycheck for the purpose of paying off the debt.

2. Increase your income with a second job

Side pushes are all the rage these days for good reason. They can be flexible, there are a lot of choices, and they are an effective way to make more money. Increasing your income could leave you with a good amount of money for debt repayment purposes.

3. Consolidate your debt

Consolidating the debt you have can make tracking and repaying easier. But just as important, if not more, it can also make your debt cheaper from an interest rate perspective.

If you have different credit card balances, you may want to consider doing a balance transfer. This allows you to transfer your debts onto a single card with a lower interest rate. You can even qualify for a balance transfer with an introductory 0% APR, which would save you interest-free months to reduce that total.

Another option is to consolidate your debt with a personal loan. There is a good chance that this loan comes with a lower interest rate than you are charged on your various credit cards.

Going into debt is something that can happen from time to time, even if you do your best to spend wisely. While it’s understandable that your pile of debt is a cause for concern, try not to blame yourself. Instead, make a plan to get rid of it as quickly as possible. If you are on a budget, give your income a boost with a little nudge and find a way to make your debt cheaper, you might end up getting rid of it sooner than you expected.

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John A. Bogar