A Surprisingly Simple, 13-Minute Plan to Start Paying Off a Bunch of Debt
Initially, I was going to frontload this article highlighting the number of Americans who carry debt — some until they’re six feet under.
But I think we all understand the burden of debt and don’t really need more statistics to rub it in.
Instead, let’s just focus on being positive, proactive and breaking free.
How to Pay Off Debt: A 13-Minute Guide to Get Started
Any amount of debt is overwhelming. And when something’s overwhelming, we tend to procrastinate — or even shut down entirely.
We’re human, after all. Sometimes, the problem can seem so big that the biggest obstacle is simply knowing where to start.
But creating a plan to pay off debt doesn’t have to be too complicated. It’s just a matter of sitting down and focusing; it takes less time than you might think.
If you’ve got 13 minutes to spare, we’ve got a list of tips for putting together a rock-solid plan for paying off your debt.
That’s less time than it takes to get caught up on your friends’ Snapchat stories.
Deep breath. Ready to learn how to pay off debt?
1. Let This Company Pay Off Your Credit Cards
When you think about how much debt you have, you might feel a little anxious.
That’s where a company like Even Financial can be helpful. It can help you find personalized lending options to refinance or consolidate your debt to potentially save thousands dollars in interest.
Even will show you all the lenders willing to help you pay off your credit card and eliminate the headache of paying bills by allowing you to make one payment each month.
You can borrow up to $100,000 (no collateral needed) and compare interest rates, which start at 4.99%. The idea is to secure a loan at a lower interest rate, potentially helping you save thousands. Repayment plans range from 24 to 84 months.
Take, for example, Katherine, who faced $12,000 in credit-card debt. Holding her back? The 15.24% interest rate. By refinancing with a 5%-interest, seven-year personal loan, she saved $12,000 in interest.
If she’d kept on the same road, she would have paid something like $14,000 in interest alone over 25 years. Yikes.
So even if you’re simply curious about what’s out there, know that checking rates on Even Financial won’t hurt your credit score — and can probably save you in interest.
Total time: Two minutes
2. Take a Deep Breath and Look at Your Credit Score
We understand. None of us want to do this.
But did you know that around 25% of Americans have an error on their credit report that is likely bringing down their score? And those poor scores can hinder every part of your financial wellness…
Banks and credit card companies aren’t the only ones that look at your credit score. You may have to authorize a credit check whenever you want to move into a new apartment, rent a car with a debit card or buy a new phone, for example.
So pour yourself a cup of coffee and check your credit score on the free app CreditWise® from Capital One®. You’ll also get a free TransUnion credit report card to show you exactly where your credit shines… and where it could use some improvement.
And don’t be shocked if you find a mistake. Last year, nearly 74% of credit-report complaints were about incorrect information.
“Credit-reporting agencies merely make mistakes, which is understandable, with the millions of pieces of information they process,” says Steve Weisman, a professor at Bentley University and the author of the fraud and identity-theft blog Scamicide.
You can easily file a dispute online. And hey, if it’s truly a mistake, you just took some debt off your plate!
*Advertiser Disclosure: Capital One compensates us when you enroll in CreditWise using the links we provided above.
Total time: Two minutes
3. Find Some Hidden Cash
Before you start hashing out a plan to tackle your debt, it might make you feel better to find areas in your life where you can save. Then you can funnel that money directly toward those outstanding balances.
Sure, a lot of us know how to save money on groceries, but what about everything else?
Try digging up some extra cash with Paribus — a tool that gets you money back for your online purchases. It’s free to sign up, and once you do, it will scan your email archives for any receipts. If it discovers you’ve purchased something from one of its monitored retailers, it will track the item’s price and help you get a refund anytime there’s a price drop.
If you want some more ideas on how to set up a passive stream of money — big or small — read this guide.
Total time: One minute
4. Automate Your Savings
Automating your savings is a great way to get a jump-start on the slightly intimidating process — without even thinking about it. And we love the idea of making that money work for you with a micro-investing app like Stash.
Start with as little as $5, and select how often — and how much — you’d like to invest. Be realistic. Even if it’s $5 a month, you’re doing something, and that’s all that matters. (Note: There’s a $1 monthly fee for balances under $5,000 for Stash users.)
And because it’s automatic, you likely won’t miss the money. Plus, you’ll be surprised with a nice little nest egg of savings — which can go toward paying off your debt if needed.
And hey, when you sign up, you’ll snag a $5 bonus to make your first investment!
Total time: Five minutes
5. Let This Bot Negotiate Your Bills Down
The price of internet — and cable, if you’re still into that kind of thing — certainly isn’t decreasing. If anything, prices are steadily climbing.
And if you’ve had to chat with a representative from your internet/cable company recently, you know how long you can sit on hold.
That’s why it’s time to call in a robot. A negotiation bot like Trim will negotiate your cable or internet bills down for you.
It works with Comcast, Time Warner, Charter and other major providers.
You can sign up simply with Facebook or your email address. Then, upload a PDF of your most recent bill, and Trim’s AI-powered system gets to work. If at first it doesn’t succeed, it’ll keep negotiating until it can save you some money.
Also, if you have any outages, Trim believes you deserve a credit, and it’ll handle that for you.
Trim takes 25% of the savings tab, and you get the rest.
Total time: Three minutes
It’s 13 minutes later and look at you! You’ve laid out a solid plan to tackling your debt!
Carson Kohler (@CarsonKohler) is a junior writer at The Penny Hoarder. When it comes to finances, she’s a professional procrastinator.