The following post originally appeared on our RoadLoans blog, The Open Road.
It’s not easy, but it can be done.
Getting ahead on auto loan, mortgage or credit card payments takes discipline and a plan – and it’s well worth the effort, according to financial experts.
“While working toward becoming debt free, I wanted to use every trick in the book to save money, increase my income, and pay down my debt faster,” blogger Carrie Smith of “Careful Cents” wrote recently at Huffington Post Money.
In the blog post, she offers her “Top 6 ways to Pay Off Any Loan Faster”:
- Make bi-weekly payments to your lender, submitting half the monthly payment every two weeks. Such a strategy will pay off your loan early because it’ll result in an extra payment per year, and reduce the interest you pay in the long run.
- Round up your payments, “an effortless way to pay extra without even missing the funds.” And, Smith writes, “you don’t need a lot of extra funds” to have an impact.
- Put any extra money you earn (or find) toward paying down your loan amount.
- Make one extra payment per year, using the money from a tax refund or work bonus.
- Refinance your loan, which Smith calls “one of the easiest ways to lower your payment, save interest and pay off your loan in half the time” at current interest levels.
- Go paperless, which could bring additional discounts, when you sign up for automatic withdrawal on your auto payments and for paperless statements.
“The bottom line,” Smith wrote, “is that paying off your loan or credit card debt early will save you money in interest and decrease the overall term of the loan.”
So, take a deep breath, and go for it. Every little bit will help your financial well-being. And if you already are working on paying off your loans early, tell us how you’re doing it.