How To Get Out Of Debt
We all overspend at one time or another but some of us let our finances get out of control. When you’re in this situation the worst thing you can do is stick your head in the sand and hope it will all go away. Your debt won’t go away but it also probably isn’t anywhere near as bad as you think. Don’t feel bad about your situation, you need to be pro-active instead and take a positive approach. You’ve got the power to be able to do something about this.
What you need to do first is work out your income and expenditure. That is what money you earn and have coming in each week or month and how much you are spending each month. You must include everything from bills to buying a coffee on your lunch break as it all adds up. Remember not to worry if your spending is higher than what you’re earning.
Next prioritize, what needs to be paid in full, what needs to be paid on time each time and what can you delay or reduce payments on? Remember that you will need a place to live so your main priority is rent or mortgage repayments and utilities such as water and electricity, all these are essential and you have to pay them or suffer some unpleasant consequences.
Then look at what you can cut back on, do you really need to eat out and buy a latte 5 times a week on your lunch breaks? By taking your own lunch and a flask you’ll save a lot! Cancel any subscriptions and maybe look at changing some of the food stuffs you buy so that your overall grocery bill is cheaper, remember this won’t be forever but you’ll have to make sacrifices.
Then what you are usually left with are the debts that you have no control over like credit and store cards or bank loans. If after making adjustments you cannot meet all your minimum repayments then you will have to contact each lender and explain this to them. Work out how much you can pay each month and see if you can come to an agreement with them, some can be quite flexible.
If any of the lenders say you have to pay what the demands say and won’t accept anything less then don’t worry and certainly don’t stop paying. You pay as much as you can afford according to the income and outgoings you worked out earlier, it shows you’re making an effort and are being reasonable.
Never let a lender intimidate you either, if you have to contact them then do so by letter, don’t ring as they can sometimes use pressure tactics to get more money out of you. Never give them personal information such as your bank or card details and especially not your phone number.
And finally if you are still struggling or are getting threats from lenders then get some independent financial advice from an organization that doesn’t charge or from a debt counseling charity. There is plenty of help out there so never suffer in silence and get yourself back on track!
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