Credit Scores in India
Debt Traps and Managing Repayments
High-interest debt can snowball, and strategies like paying the highest-rate debt first help.
How to escape.
Snowball
Interest on unpaid balances compounds quickly.
Avalanche method
Pay minimums on all debts and put extra money toward the highest-interest debt first.
Consolidation
A cheaper loan can replace several expensive ones.
Talk to lenders
Banks can sometimes restructure repayments.
Two cards
A person clears the card charging 42 per cent before the one charging 30 per cent.
Ignoring bills until they pile up
Early action is cheaper.
Key takeaways
- Compounding worsens debt.
- Target high-rate debts first.
- Consolidation may help.
- Talk to lenders early.
No recording for this one yet - EconReader can read it aloud for you.