17 Oct How to Pay Off Your Bond in 5 Years
Have you been thinking of paying off your bond in 5 years? This is an ambitious goal, but with enough planning, it can be achieved. You might want to pay off your bond earlier to save money on interest, invest in another property, reach financial freedom, or even for the sake of being debt-free.
Paying off your bond in less than 5 years requires significant financial discipline, strategic planning, debt consolidation, and possibly making lifestyle adjustments.
This blog post outlines how to pay off your bond in as little as 5 years: strategies to consider, the role debt consolidation plays, and possible benefits and drawbacks of completing bond payments early.
Paying Off Your Bond Early
First, assess whether you’re liable for any early payment penalties. Some banks might make you extra for paying off your bond early because they’ll lose out on the extra income. Calculate your remaining balance, monthly payments, and how much you have to pay in interest.
Then, create a detailed budget, noting where you can save money and set financial targets. If you can, allocate more of your salary to making bond payments.
Put More Money Toward Your Bond with Extra Finance
One of the most effective methods of putting extra money toward your bond is acquiring extra income. Do this by getting a side hustle or a second job. You might also consider leaving your current job for a higher paying one–every year you’re in an industry incrementally increases the pay bracket you could fall into. For instance, if you’ve worked in the same company for 3 years, you might scout job boards for more managerial roles, which could significantly boost your income. Allocate any bonuses, tax refunds, and other financial gains toward bond repayments.
Increase Bond Payments with Debt Consolidation
If you have multiple other debts, consider refinancing them. This involves taking out a consolidation loan to pay off all your other debts at once. Using this strategy, you’ll secure one monthly payment instead of money and a much lower interest rate. Additionally, you’ll have a longer repayment period, allowing you to put the freed-up budget toward bond repayments.
Budget Better
Consider making lifestyle adjustments like shopping wholesale, eating out less, stopping unnecessary services (like that other music or TV streaming service), and finding more affordable alternatives for necessary services (like cheaper insurance, for instance).
The easiest way to save on debt repayments is through debt consolidation. Since it’s a personal loan, you’ll secure much lower interest rates than on debt like revolving credit (store and credit cards). You could consolidate car finance, medical debt, student loans, revolving credit debt, and any other unsecured debt.
Reach out to us to talk to a team that’s got your back. Debt Refinance’s consultants are experts with years of experience in the refinancing space. We would love to help you save money, pay off your bond faster, and reach financial freedom.
Contact us now to find out more. We’re excited to hear from you!