How Can I Repay My Debts Quickly?

Paying debts off quickly will save you money on finance charges and give you greater financial freedom. Once the debts are paid you can use the extra money to save for retirement or start a home-based business. Some debts, such as credit cards with low balances, are easier to pay off than others. For example, paying off your home mortgage early could require a lot of discipline and patience. That can be done, but you're better off focusing initially on high-interest credit cards and other debts.

Instructions

1

Make a list of your debts ranked by interest rates. Paying off the accounts with the highest interest rates first will save you the most money in finance charges.

2

Review your household income and budget. Make changes to your budget, if necessary, so that you can devote more money to paying down debt. If necessary, eliminate vacations, cable television and eating out.

3

Get a part-time job and devote all of the money to paying down debt. Use the money from your second job and cuts in your budget to begin paying off debts one at a time.

4

Settle your unsecured debts to speed up the process -- if this is an option. Credit cards are the most common example of unsecured debts, which do not require collateral. SmartMoney reports that creditors will sometime settle unsecured debts for 20 percent to 75 percent of the balance, but the account must be three months past due and in danger of default, according to SmartMoney. Debt settlement will hurt your credit score, but it is an option for paying debts quickly. With shrewd negotiating skills, you could pay off $10,000 in debt for just $2,000 -- and possibly accomplish that in just a few months of saving or earning extra income.