It is neither desired nor it is morally correct to live long in debt. Whenever you feel that you are drowning in debt, try to hold the helm before it is too late. And if you are already in a state of deep-debt, do not wait for the calls from collection agencies. Think some strategies to pay it off ASAP.

Now the question comes how to pay off the debt? How to plan for it? What is the right way to proceed, so that one can get out of debts without any hassles? Well, there is no generalized solution for the problem. The solution entirely depends upon the financial state of each individual; however, some all-purpose solutions are suggested here, keeping in mind the most problematic financial conditions possible.

Before the proper debt solution is suggested, a few case studies were made and the research yielded the following results. The solution for the respective case is mentioned along with.

Case 1

One high amount loan - It is a very rare case in our country. The normal trend here is to take loan from different creditors and normally the interest rate also varies for different creditors. Anyway, if you have a high amount loan and you wish to close it now, then you can take a loan too, to pay it. But before that, it would be wiser to consult a counselor, who is the best person to suggest if your pocket would permit taking a loan.

Ultimately, if all the points go in favor of you, and finally if you start the debt repayment program, be careful about not going for any unnecessary loan until you are free from the previous one.

Case 2

A number of loans from different creditors and of different interest rates - The number of candidates in this category is much more in our country. So this is the most common type of example of being in debt. There are three solutions to overcome this situation.

First, select the highest loan amount, and start paying it back. For example, say, you have a few loans of amount $22,000, $5,000 and $80,000. Then first pay off the loan of amount $50,000.When the process will be going on, you might have a tight budget, but face it. As soon this loan is paid, your monthly installment is going to drop dramatically. And it is going to give you a kind of mental strength also that - "Oh! I have paid off the highest amount!"

Second, select the loan for which you are paying the highest interest rate. And pay it first. Suppose you have four different loans for which you are paying, say, 9.9%, 11%, 17% and 5% interest. Then first pay back the loan for which you are paying 17% interest. It will reduce your monthly payable installment and you can see the effect from the next month.

Third, start paying the small amount of loans and start from the lowest amount. This strategy is helpful when you have too many loans. If your loans are of amount, say, $2,000, $18,500, $4,600, $9,000 and $50,000, then pay $2,000 first, then $4,600 and so on keeping the $50,000 loan aside.

One may ask how this strategy is effective? Is it a good policy? Well, the answer is yes, because, it is easier to pay the small amounts as it will not impart a heavy load on your monthly budget and you will be relaxed to know that instead of having five loans you are now with one high amount loan, for which you can go for a consolidation loan too, and the installment and interest rate for consolidation loan is usually lower.

So stop blaming your fate and no more depression! Select the right strategy for yourself and forward the first step towards debt free living.