Finally you can start saving money with this easy and free way to pay off your bills
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I found a new way to reduce pesky bills quickly. Because if you’re like most people, you want to quit debt worries fast.
Not only does debt take a lot of fun out of life, but it also prevents you from taking vacations when you want to, giving gifts to family, and buying things like lottery tickets to make life fun.
And it restricts you from buying more lottery tickets, because you know playing frequently is the best way to improve your winning chances.
This is something you can get started on today, and the benefits will flow on for the rest of your life.
My usual advice and the method I use for reducing debt fast is to pay off the smallest debts first. As each debt is finished, you put that extra payment to the next largest.
But now I found a way to do it more efficiently. Here's how it works for 2024:
1. Make a list of all the consumer debt you have. That doesn't include day-to-day expenses like food and rent, but will include a mortgage if you have one.
2. Now, beside each item write down your monthly payment.
3. Divide that monthly payment into the main total for each one. This will give you a ratio that prioritizes your debts far more efficiently.
Here's an example of dividing the monthly payment into the loan balance. Then rate them with the highest Ratio at the top:
| Loan Type | Loan Balance | Monthly Payment | Ratio (%) |
|---|---|---|---|
| House | $100,000 | $1,500 | 66 |
| Loan | $5,000 | $200 | 25 |
| Car | $12,000 | $500 | 24 |
| Visa | $7,000 | $350 | 20 |
4. Now, choose the payment with the lowest ratio.
In this example above, it's the Visa card with a ratio of 20. Then use any extra income to pay that card off first. For example, you might find you're able to pay $600 a month in total off your Visa.
That's an extra $250 a month above what you pay. This means that the card will be fully paid off in a year.
Here's where it starts to get better.
5. Take that monthly Visa payment of $600 and use it to pay off the next low ratio item... in this case the car with the 24 ratio.
Because of the extra payment, you're now able to pay $1100 a month off the car, which means that it will be fully paid off in just a further 6 months!
Here's why it works this quickly...
Because you've been paying the car off at a regular amount already, it has a reduced balance of $6,500 after you finish paying the Visa card. So now paying the car back at $1100 a month lets you pay it off completely in 6 months.
CAR PAYMENT GONE!
Now that you don't have the car payment, you have a total of $1600 a month (ex-Visa and ex-car payments) free to apply to the next low ratio, the loan of $5,000.
On and on it goes, rapidly speeding up until at the final loan - your house. You have over $3,000 a month to apply to that amount. No surprise, it will take only a little under three years to pay back that mortgage!
YOU’RE FREE OF DEBT!
Now you're completely debt-free, and altogether it's probably taken you less than 5 years! Most people are amazed at the speed at which it works.
Five years is good - but to do this even more quickly, you'll need a little extra income to put towards the payments.
If you have some spare money over after the monthly payments, great. If you don't, look for ways to increase your income by reducing some expenses. Or better - increase your income.
There are two success secrets for reducing your debt.
SECRET #1: Once you've decided you are going to pay down your debt, don't SPEND. Any further spending will just increase the time it takes you to clear everything.
SECRET #2: Daily, visualize the life you going to have free of debt. This is important because it gives you the incentive to carry on when times are tough. Also reward yourself after each major success. Go out to dinner, buy or sell something special... just make sure that you celebrate at each stage.
If you've taken the time to read and work out this system, you are 99% ahead of the rest of the population who will never be free of money worries for most of their lives. Enjoy your debt-free life!
