There is more than one way to pay off your debt, find out how | Debt consolidation

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Debts do not allow us to fully enjoy our money. Having them, much of our salary goes to pay them and little goes to saving . It is important, therefore, to have only the necessary debts. In other words, those that represent an investment and not compulsory expenses .

In Good Finance we want to help you to pay your debts, so in this note I tell you that there is more than one way to do it. Explore each of them and you will discover what is the most convenient for you.

Full payment

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This payment is what I usually make every time I have any debt, either by loans or by credit cards . The great benefit of total payment is that you do not accumulate interest. Personally, it is my favorite payment because it allows you to end the financial commitment you acquired soon.

One factor against this is that if you don’t have your monthly income and expenses well organized ( personal budgets ), you can feel your economy tight. You see how important it is to plan all the credits or loans you have!

The payment agreement

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I do not recommend getting to this extreme because it can play against you. Through this payment your credit history may be affected. This is reached when you are late in your monthly payments, which makes the bank call you to fix or regularize the situation.

Debt Consolidation

I recommend this form of payment before falling into delays with the bank. The main benefit of consolidating debts is that you combine all the debts that you have and thus you pay a single bank the total, which allows interest and commissions to be reduced.

If you want to opt for this form of payment you must be up to date on your monthly payments with the banks or financial entities with which you have debts.

Prioritize payments

Prioritize payments

The priority payment is that you organize your debts as a factor to those that generate more interest, so your payments become urgent. By following the priority payment method you will first pay the most expensive debts , so you can free yourself from them sooner. It is the payment you should follow if you do not have much money available each month, but you want to reduce the debt you have.

As you can see there is more than one way to pay off your debts. My favorite will always be full payment because it allows you to enjoy liquidity in less time, it’s all about knowing how to organize. Which do you prefer?


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