These 4 Loan Repayment Tools Are All You Need to Get Out of Debt
The Federal Reserve reported that the total household debt has now reached a record-breaking amount of $13 trillion – even exceeding the total amount before the onset of 2008 financial crisis. What is causing such a sharp rise in household debt around the United States?
Americans are using credit cards more than ever’ but apart from that, people are getting houses on mortgage, cars on auto loan and quality education on student loan and as the total debt piles up, people struggle to pay it back on time. If you happen to be one of the many Americans who are kicking off the new year with the resolution to get a handle on your debt, these 4 tools will give you the head start that you need to reach your goal.
UNBURY.ME – Create a practical payoff plan
As the name suggests, this website helps you create a plan to unbury yourself from your debt. All you need to do is sign up and create a user account before listing all your debt and finding a payment plan the suits your budget and needs. This online tool is free for everyone to use and offers two different methods of tackling debt: an avalanche plan that allows you to attack one debt at a time starting from the biggest and a snowball method that creates a payoff plan starting with the smallest debt and going upwards from there.
Both methods can be beneficial in their own ways; by choosing avalanche, you may have to make large payments in the beginning but you will save money in the long run. Whereas the snowball method lets you start small so that the slow decrease of total debt motivates you to put more money towards your goal in the future.
QOINS – Pay off little by little with each purchase
Quoins is a great app that lets you tackle debt subconsciously without having to put away any money! Want to know how it does that? Every time you buy something using your debit card, the app rounds up the total amount you spend to the nearest dollar and then puts away the spare change towards your debt payment.
The app was launched on January, 2017 and in the past 12 months it has saved almost $1 million total in spare change. Simply sign up with the mobile app and link your bank account in order to start making savings. Most users make up to $600 per year but the amount depends on how much you spend using your card.
DIGIT – Auto-save money to meet payoff goals
Digit is another great mobile app that sneakily takes money out of your checking account and puts it aside in an in-app saving account. The app only takes money from your account when it thinks that you won’t be able to notice it, and it does that by analyzing your spending habit and calculating a reasonable amount of money to save.
The app charges a $2.99 monthly fee and an average user can amass up to $110 per month in savings. Once you’ve reached a new milestone in your savings, the app gives you a notification in order to increase your motivation to reach the final goal.
DEBITIZE – Avoiding future debt
Most people get into credit card debt simply because they’re tempted to buy something they cannot afford, even if they don’t need it and with a credit card in our pockets at all times, it’s hard to resist the temptation sometimes. Debitize is a great app to help you think of credit in more concrete terms and avoid further debt – especially if you already have taken a loan or just cleared all the debt on your card.
Every time you make a purchase with your card, the free app withdraws the amount from your checking account and pays back balance within a couple of days on your behalf so that you start every month with a zero balance on your credit card. This is also a great way to improve your credit score over time.
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