- 1). Calculate how much interest you owe on your debt each year. So, if you have a credit card with a $1,000 balance at 20 percent interest, then you will be paying $200 in interest annually.
- 2). Decide when you want to have the whole debt paid. Assume you want it paid off in two years. This means you are going to need to pay a maximum of $1,400.
- 3). Divide your total from step 2 by the amount of months. In this case, it is a little over $58. This is your monthly payment.
- 4). Pay at least that amount each month. This will ensure that your debt is paid off in the time period you set.
- 5). Pay extra amounts whenever you can. Paying off debt should be a priority.
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