If you have a credit card, it’s good to go beyond the minimum repayment and pay off as much as you can each month. Ideally, the whole balance if you can.
If you have a personal loan, you may be able to negotiate with your lender to increase your repayment amounts.
Look at your budget and see how much you have to spare. You may want to prioritise debts that have higher interest rates and pay these off first. If you can, try to increase your repayments each month, even if it’s a few pounds – this can make a big difference over time.
If you’re making monthly repayments of a set amount, you could increase this to fortnightly to help you repay the debt quicker. You’ll have more flexibility on a credit card but may be able to increase your repayment frequency on a personal loan too.
If you have a credit card, you can divide your usual monthly repayments by two and start paying that amount every fortnight instead.
So, if you’re currently paying off £100 per month in 12 instalments, you’ll repay £1,200 over a year. But if you make 26 fortnightly payments of £50, you’ll repay £1,300 over a year.
If you have a personal loan, you could add a standing order to pay a certain amount at the mid-point of the month. This would be on top of your regular monthly repayment.
For example, £20 extra per month will mean you pay off an additional £240 over a year. You may need to check with your loan provider if you’re able to do this.
There may be certain times when you come into money. Perhaps you get an unexpected refund or have some left over at the end of the month.
If this happens, and you can make overpayments without any charge or penalty, you could use that spare money to repay your debt.
Keep in mind – there may be a charge to make overpayments on some personal loans, so check the terms and conditions to make sure it’s worthwhile.
You could try a combination of these 3 tips. For example, increasing your monthly repayments on credit card debt from £55 a month to £60 and then paying £30 every 2 weeks can help you reduce your debt quicker. If you can afford to, you could then look to make overpayments.
The quicker you repay your overall debt, the more you’ll save yourself in interest payments, and the sooner you’ll be free to put your money towards something else.
