Here’s how to get rid of that loan balance.
There are plenty of good reasons to take out a personal loan, whether it’s to cover a slew of unexpected bills or finance home renovations. The good thing about personal loans is that they don’t hurt your credit score in the same way that too high a credit card balance could. In fact, if you make your personal loan payments on time each month, it could actually help your credit score improve.
Yet there may come a time when you are truly ready to get rid of your personal loan debt. If you’re tired of having those payments going over your head, here’s how you can get rid of them in 2022.
1. Get a tighter budget
You may have certain expenses that you spend money on that you can technically do without. Depriving yourself of these indulgences altogether could make you miserable. But cutting back modestly and spending more wisely could free up money you can use to reduce your personal loan balance.
Take a look at your budget and review your different expense categories. You may find that a few small changes add up to a decent amount of money that can be spent on your current loan.
2. Increase your income with extra work
You may only have a handful of small items to cut into your budget. Or, frankly, you might not want to cut these things down too much because they bring you continued joy (your store-bought coffee may give you more energy for the day than your cheaper homemade counterpart). If so, a nice boost in cash flow might be the only thing that will make your personal loan wipe out in the New Year. You can earn this money by taking a second job.
There are many options available to you these days to get a side business. If you enjoy interacting with people, you can take shifts at a local restaurant or retailer, or put your car to work and start driving for a rideshare company. And if you’d rather do that side job from home, you can look into data entry, website design, or paid blogging.
3. Use bonus money to reduce your loan balance
You could make some extra money at some point in 2022, whether it’s a tax refund or a work incentive bonus. Putting that money on your loan balance is a good way to reduce it so that it disappears by the end of the year.
How much do you have to push to repay your personal loan?
If you have a relatively low interest rate on your personal loan, and speeding up your repayment schedule is causing you difficulty (for example, having to work a second job when you’re really short on time), then you You might want to stick with your current repayment plan, even if that means postponing your loan beyond 2022. But if you’re sick of having that loan hanging over your head, then these tips might be your ticket to lose it once and for all.