Pay off debt this Memorial Day with these tips
Are your finances ready for the next half of the year? (iStock)
With warmer temperatures just around the corner, now is a great time to tackle some spring cleaning projects. In addition to tidying up the backyard, opening the windows to air out the winter, and ditching old items, it’s a great time to spring clean your finances. This Memorial Day weekend, devote a few hours to reviewing expenses from the last quarter and planning for the months ahead while getting out of debt.
Here are a few debt repayment methods you should consider to improve your financial situation.
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1. Refinance your mortgage
Interest rates are still low. At publication, the average 30-year fixed-rate mortgage is 2.750%, and the average 15-year fixed-rate mortgage is 2.125%. Interest rates are slightly lower than the same time last year and still significantly lower than several years ago. If you want to pay down your debt faster or save money on your monthly payment, a refinance could be a good option.
You can explore your mortgage refinance options by visiting Credible to compare rates and lenders.
2. Refinance your student loans
If you have a private loan, you may be paying more than you should. With refinance rates sitting near record lows, you could benefit from a student loan refinance. If you’re considering a refinance, use an online student loan refinancing calculator to determine what your new monthly payments could be when you lower your interest rates.
3. Shop around for better insurance rates
How long have you been with the same auto or home insurance company? When is the last time you checked to see if you could get a lower rate? With a clean driving record and a fair credit score, you could save a significant amount of money on your car insurance just by looking at a different company. You can also save a lot of money on your home insurance when you compare rates from multiple companies.
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4. Consider a debt consolidation loan
Paying off debt is a great way to free up money for investing or other expenses. You can save money on your debt by opting for a debt consolidation loan. A debt consolidation loan lets you lump all your debt payments into one, typically lower, cost at a lower interest rate. You may even end up improving your credit score while you pay off debt. You can check out your debt payoff options by visiting Credible to compare personal loan rates and lenders.
5. Use a balance transfer credit card to reduce debt
Another tactic for saving money on debt payments is to utilize a balance transfer credit card. Many companies offer 0% interest rates for up to 18 months. If you can pay off your credit card debt quickly, you could save a lot of money on interest. You’ll want to make sure you have a good credit score and qualify for a card with no annual fee to maximize savings. Check out your different balance transfer card options by comparing companies on Credible.
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Remember to account for upcoming expenses and events
One of the best ways to straighten up your finances is to create a budget. As we approach the summer, make a list of upcoming events, holidays, birthdays and vacations. Set a budget for the event and start setting money aside now to help cover the costs without hurting your bank account. Other events to plan for include school fees, tuition, clothes, taxes and Christmas.
Put your three-day weekend to good use by setting up financial goals for the next half of the year. Staying organized is key to saving money, building credit and getting out of debt.
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