Debt is like a disease that does not allow us to live a normal and happy life unless we take control of our lives. Most of us don’t even know how to get into this situation. Buying everything on credit has become part of our culture. But don’t keep blaming your life. You can regain control. Imagine a life of guilt.
1 Stop getting new debt. The most important thing is to start now. Don’t start tomorrow or next week. Now start reducing your debt. Recognize the problem The first step is to admit that you have a problem. And admitting it’s just your fault, it can be difficult. But this is very important. Remember the reason you owe is because you are buying things that you can’t afford. You keep borrowing money in the future. Stop spending money you haven’t earned yet. Stop lending the future.
Paying your debts
- 2 Stop spending. If you have debt, your credit cards need the first thing you need to do. They just raise the problem. Believe me, once you get rid of them, you won’t miss them.
- 3 Spend your money on essential things like food, basic services, etc. .. (cable TV is not one of them). Make adjustments. View your monthly expenses and reduce some of them. Stop eating, hit coupons on the internet before going to the supermarket. You’ll be surprised how much you can save if you see your expenses.
- 4 Establish an emergency fund. It is important to save some money before paying your debt. Open a savings account for an emergency fund and request an automatic transfer of your account to your savings account. How much should you save? Ideally, about $ 1,000 to get started. This money is for emergencies only. Keep this money in cash but not quickly accessible. Do not request a debit card for your emergency fund. Don’t sabotage your efforts by facilitating your savings on insignificant things. Consider opening a savings account with an online bank such as ING or Emigrant. If you have an emergency, you can easily transfer the money to your check account. It will be there when you need it, but you won’t have the option to spend it spontaneously. If unexpected expenses arise and you do not have an emergency fund, you will stop paying your debt to pay for unexpected expenses. The emergency fund assures you that you can pay your debt. Control your expenses. You can find it difficult to monitor your expenses and ensure that you follow your spending plan. The key is to first establish your emergency fund. Then start paying your debt. Then pay your monthly bills. Then change these amounts in cash and place them in separate envelopes. It is outdated, but it works, so you don’t have to worry about spending more than the account. If your envelope is empty, you can no longer spend. Keep reducing non-essential spending as much as you can, so you can meet your spending plan.
- 5 Implement a debt payment plan. Now that your finances are under control, you can start paying off your debt. 6 Order your debt from the highest to the lowest.
- 7 Indicate an amount of money to pay monthly.
- 8 Make the minimum payment on all debts except those that are low.
- 9 Channel any money you owe to the lowest debt. When the debt pays, your amount is not changed for debt but use this surplus to pay a little more than the minimum on your next lower debt. Once you are in charge of your finances and start paying your debts, there are ways to make bigger payments to get them faster. See what your biggest expenses are. Is there any way to eliminate or reduce it? Can you sell your car to buy a cheaper used model? Can you rent a smaller house or apartment? Can you sell your home to rent a cheaper one? Can you survive with just one car? Can you disable any service you use? Whatever you do, make it money to pay your debt, don’t spend it. Get a part-time job or sell things you don’t need on eBay, or do anything that can mean extra income. You can free yourself from debts faster. Measure Your Progress On your debt spreadsheet, be sure to make updates every payday (or when you pay) so you can see how you reduce your deudas. Calculate how many months you have left before you pay off your debt completely. It may be long, but someday you’ll reach it. Four. It’s important to celebrate not only when you’re paying off your debt, but if you eliminate some of them. Make it an adventure. Enjoying It can be very satisfying to stop spending too much and regaining control of your finances. Search for free entertainment and enjoy looking for ways to spend less. Yes, you can live a life free of guilt.