Whether you need extra funding for a project or help paying off bills, large loans can give your budget a much-needed boost. However, when it’s time to pay off your debt, going over the full timeline can feel overwhelming. Follow the steps below to stay on track with your payoff plan.

How to Follow Your Loan Payoff Plan

1. Create a Monthly Budget

To create a monthly budget, factor in your debt payments, necessities like food and utilities, savings, and other regular costs. There should always be some room for infrequent events, like holidays or emergencies, but try not to stray too far from your budget.

2. Record Your Progress

Keep a spreadsheet or notebook to record your debt payments. This may seem tedious when your credit union is keeping tabs on the balance, but this task will mainly be for your benefit. Tracking your progress and seeing the debt gradually get lower will motivate you to stick to your plan.

3. Make Extra Payments

Whenever there is room in your budget, make extra payments. For example, if you receive a bonus at work or a money gift, allocate it toward your debt. Long-term budget increases, such as a raise, will allow you to increase your monthly loan payments. The more you pay early on, the faster your debt will be cleared.

4. Avoid Building More Debt

Introducing more debt will only complicate your payoff plan and keep you in debt for longer. Avoid taking out more loans, limit your credit card use, and use cash when you can. In general, you shouldn’t make any big purchases until your original loan is paid off.

5. Give Yourself a Break

Some people may be capable of funneling every cent they make toward their debts, but you don’t need to push yourself to do this if it will only demotivate you. Constantly preventing yourself from doing what you enjoy may take a toll on your mental health. If you have consistently met payments or paid extra recently, consider treating yourself to a night out or a product you’ve had your eye on. Just remember to stay within your budget.

With hundreds of millions of dollars in assets and over 60,000 members across Hawaii, Hawaiian Financial Federal Credit Union is one of the leading financial institutions in the state, with a reputation for combining personalized service with technologically advanced personal banking solutions. Learn more about our broad array of services online, follow us on Facebook, Twitter, and Instagram for news and updates, or call (808) 832-8700 on Oahu or toll-free at (800) 272-5255 with any questions.