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Develop a debt repayment strategy to eliminate highinterest debt from "summary" of Broke Millennial by Erin Lowry
When it comes to paying off high-interest debt, having a solid strategy in place is crucial. This means taking a close look at your current financial situation and determining how much you can realistically afford to put towards your debt each month. It may require some sacrifices, such as cutting back on unnecessary expenses or finding ways to increase your income. One common approach to tackling high-interest debt is the "snowball method." This strategy involves focusing on paying off the smallest debt first, while making minimum payments on larger debts. Once the smallest debt is paid off, you can then move on to the next smallest debt, and so on. This method can help you gain momentum and stay motivated as you see your debts gradually decrease. Another approach is the "avalanche method," which involves prioritizing debts with the highest interest rates first. By tackling these high-interest debts first, you can save money in the long run by reducing the amount of interest you have to pay. This method may take longer to see progress compared to the snowball method, but it can be more cost-effective in the end. No matter which strategy you choose, it's important to stay organized and track your progress. Create a budget to help you stay on top of your expenses and make sure you're allocating enough money towards your debt payments each month. Consider setting up automatic payments to ensure you don't miss any deadlines and incur additional fees. It's also a good idea to reach out to your creditors to see if you can negotiate lower interest rates or set up a payment plan. Many creditors are willing to work with you if you're upfront about your financial situation and show a willingness to make payments. Don't be afraid to ask for help if you need it – there are resources available, such as credit counseling services, that can provide guidance and support as you work towards becoming debt-free.
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