Deal with your debts
The biggest decision of the whole debt cycle is facing up to the problem and dealing with it, the longer you leave it and deny its existence the worse it gets. You have debts, and now you need to do something about it in order to control it.
It doesn’t matter whether you are in deep in financial difficulties, or you have only just stopped yourself from falling into the pit of debt trouble, you are at a point in your life where you need to stop your debts from taking over your and the only way to do this I’m afraid, is to, let your debts to take over your life – for a little while that is.
It is important that you continue on with your regular life, but to enable you to live debt free in the future you will have to give in to your debts and get rid of them as soon as possible. To do this there a number of different options available to you, more than can be covered in one article.
It is more than likely that getting rid of your debts sooner rather than later is the preferred option. If you want to deal with your debt, fast, you will be able to do so, but you will need to cut back on some things in order for this to happen. This will involve commitment, dedication and knowing what to economize on.
To start you will need to get a pen, piece of paper, all your debts. What you will need to do is put down on a piece of paper all your debts and put them in order of the smallest to the largest. This puts all your debts as a monetary value in one place, From here you can lay out a payment plan base on your available budget. The idea is you pay each debt its minimum monthly payment every month, while concentrating on one debt till its paid. This is done by paying off the minimum payment every month plus some extra to get the debt paid sooner, when paid off this money is used to pay the next one off, creating a snowball effect. Below are a few options available to you
* Pay off your debts one by one, in an orderly manner
* Use the snowball method to pay off your debts
* Talk things over with your creditors to be able to pay off your debts in any which way that you can
* Consolidate your debts into one and pay it off with only one smaller payment
* You also have the option of considering bankruptcy as a way to deal with your debts – but this should not be your first choice!
There are of course other ways to deal with your debts which are not, strictly speaking, dealing with the debts you have accrued now, but instead deals with debts which you might accrue in the future.
This might sound silly now, but the truth of the matter is that after you manage to extract yourself from the pile of debts you are under right now, you will have to think about the future, and ways and means of keeping yourself debt free in the future so that you don’t become mired in the same situation once again.
* Controlling your spending – this means no impulse buying!
* Staying away from the temptation of credit cards
* Practicing better economy in your life
* Trying to better yourself and find a higher paying job
* Keeping track of your spending – basically you keep to a budget
* Learning to recognize the signs when you might be going off track again
* Getting your family involved in the whole thing so that they too can help – this not only spreads the burden from your shoulders to others, but it really does help if you can share your troubles with somebody else
Like with any financial undertaking, a professional opinion based on your circumstances is the best way to proceed, as the financial world is continually changing to offer new products and money management.