Managing finances is tough. Whether it is in your personal or professional life, it is often one of the most necessary skills that is not taught in school. But for some, it is something learned through trial and error.
An online report by <http://quickbooks.intuit.com> gives some tips on how to repay your business loan faster.
Stop creating debt: The first step when trying to get out of debt is to stop creating more debt. This is probably the hardest step as you have more than likely been spending money you don’t have for a while and it will take some time to determine what you can and cannot afford.
For businesses, this doesn’t necessarily mean jettisoning employees or cutting back on services, unless you believe these are truly the issues weighing down your organisation’s budget. Before you take any drastic action, you should review your financial statements for the past three to six months.
Analyse your profits and losses and all of your expenses and determine if there is anywhere you can cut back a bit.
Stack up your outstanding debt by interest rate, from the highest to the lowest: Whether you are talking about credit card debt or bank loans, the interest rate on each can greatly inhibit your ability to effectively pay down the principle loan amount.
Investigate the opportunity to lower interest rates: It is possible you can get some of your interest rates lowered. For credit card debt, this is primarily done by transferring existing balances to credit cards with a lower interest rate. For bank loans, you should call your loan manager and discuss options. If you have made regular payments and your business is in good financial standing, an argument can be made to lower your rates.
Create a repayment plan: The first step of this repayment plan is to make a list of all of your minimum monthly payments and make sure they are covered.
This article appeared in The Punch’s Personal Banking with Nike Popoola