The benefits of dealing with debt now
It is common for Florida residents to have personal loans, credit card debt or student loans. Therefore, there may be less urgency to pay it down as soon as possible. However, it is still a good idea to eliminate debt as quickly as possible. One of the best reasons to pay off debt quickly is that it reduces the amount of interest paid on the balance.
Paying down debt as quickly as possible may also work to improve an individual’s credit score. The amount that a person owes contributes 30 percent to the credit score, which means that those who have less debt may have a higher score overall. Another benefit to paying down debt is the financial security it provides. Instead of giving money to a lender, it can be used instead to save for an emergency or for the future.
In many cases, financial security is linked to mental and physical health. In fact, those who have debt are three times as likely as those who don’t to suffer from depression or anxiety. This is in addition to the stress that can be caused by trying to stay on top of debt payments while also trying to cover basic living expenses.
Those who are struggling with credit card debt or other debt balances may wish to file for bankruptcy. Bankruptcy may allow an individual to have debts discharged completely or have them reorganized and paid off over time, depending upon the particular chapter. An lawyer may explain the benefits of filing, such as an automatic stay of creditor harassment and collection activities including wage garnishment.