Many say this should be Step 1…Take Control of High-Interest Debt
The idea here is that in most cases, it makes sense to prioritize paying off this debt first—because the interest you’re losing to the lender is likely higher than the gains you’d earn from almost any investment
Step One: Recognize Your Debt
Identify debts like:
– credit cards,
– car loans,
– payday loans,
Anything with a higher interest rate than a mortgage or student loan.
Step Two: Prioritize Repayments
Focus on paying off the highest interest debts first while maintaining minimum payments on others to reduce overall financial burden.
Step Three: Build Consistency
Develop a steady repayment habit after establishing once the highest interest loan is paid off, then you can easily pay off other high debt because you have budgeted for more.
If you believe this should be your step 1 then by all means focus on getting out of high interest debt first.
You can retract your investments in your TFSA and put them towards the debt.
We believe that PAYING YOURSELF FIRST with a TFSA is the most important because once you see the benefits of compound interest, you will become super motivated to NOT only get started on this journey but to stick to it.
Paying off debt can feel impossible and may discourage many to even get started on a path to financial freedom. It is not impossible, you are on the right path.
Paying off debt can be very tough
It involves a lot of sacrifice and dedication but it is not impossible.
Please visit: https://www.canada.ca/en/financial-consumer-agency/services/debt/debt-consolidation.html
You can:
Get help from a credit counsellor
Choose a debt consolidation product
- Lines of credit
- Loans
- Credit card balance transfer
DEBT FREE FEELING
Take the Next Step
If you have paid off all high interest debt or do not have any debt to begin with then CONGRATULATIONS! This is a huge step to get past, you should be very proud.
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