Well, there is one common dream that all working people have i.e. reach a stage of their life where they don’t have to worry about anything. A time where they can easily sit at their porch with their chair and watch the setting sun sitting relaxed. Yes, this is something that everyone deserves after working tirelessly for so many years where they have been fulfilling the family responsibility and take care of all their needs. Unfortunately, achieving this dream is not that easy than it may sound. Between the age of the working and the day of retirement, a person tries to accomplish all the goals like buying the first home, own car and many other things.
Well, in doing so, taking out multiple debts is something common and viable. However, it is your utmost responsibility that you clear your debts before you retire so that you can live the life that you always wanted. Yes, it will be difficult but not impossible though if you give your 100 percent. Here, in this blog, we have prepared a list of useful tips that can help you to clear all or at least the major chunk of all your debt. So, let us see them one by one.
How to clear all your debts before you reach your retirement
- Create an effective budget
First and foremost, you need to create an effective budget so that you can have the exact idea of how much money is going in and out from your pocket. While creating the budget, try to reduce your discretionary expenses and make more room for your debt installments amount. This will ultimately help you in clearing your debts much faster. Also, if there are debts that you not been paid for a long time and the lender has filed CCJ (County Court Judgement) against you, then you can look for a lender in the UK who offers CCJ loans with no guarantor. Clearing this debt will help you from getting a multi-years stain on your credit report and even from any legal custody.
- Make a regular bill payment
Another major thing that you will have to keep in mind during your work life is to make sure that you don’t procrastinate your bills and rents. Try to always make your bill payments on time so that you won’t have to deal with a mountain of undue bills in the end. Ignoring the bills will impact on your credit score as well which is one of the most important things that most lenders check before approving the fund. If somehow you miss a payment, then don’t wait for the next month to pay else till then it could be reported to any credit bureau. It will be better that you pay the amount the same month as soon as possible.
- Go more than the minimum
Paying only the minimum amount is not a very bad thing as at least you are trying to finish off your debts early. However, going with the minimum payments for quite a long time leaves a bad impression to the lender who might consider you like not so worthy borrower if you visit one to apply. So, if your financial situation is under control and you are capable of paying more than the minimum amount, then you should definitely grab the opportunity with both arms open.
- Prioritise your debts
Well, if you are under the burden of multiple debts, then you should focus on the ones that have a high-interest rate in it. This way you will solve a lot of money that would have been accrued into a high amount. It is important that you prepare a strategy to tackle all your debts in a more effective and way and rapidly. The interest rate in credit card is significantly higher than other types of debts, so make sure that you clear all your credit card debts as soon as possible.
Wrapping up, these were the tips that you can follow in order to clear your debts more rapidly before you reach your retirement.
Lisa Ann has developed a well-experienced professional career. From managing the staff of more than 50+ loan experts at Fastmoneyfinance to boosting the delivery of various loan offers, she has acquired many challenging roles to come out with the best results for the company. Lisa Ann is a Senior Content Author and the Chief Financial Advisor at Fastmoneyfinance. To back her massive experience in the UK’s financial industry, she has the postgraduate degree and diploma in Business and Finance.