Are you unable to manage the weight of your debt? Are you feeling lost? According to a survey, close to 189 million Americans have credit card debt. So, how are they trying to stay calm and pay their debts off? You will need to do these to ensure you don’t be a defaulter when it comes to debt!
- You need to know how much you Owe!
The first step towards getting your debt right, and paying it off before it becomes mounting is to understand how much is actually owed by you. The best way to do that is to have a tracker sheet, through which you can keep all your invoices and expenses organized.
Once you know how much is actually left to be paid, you can work on the finances to pay the debt off in time.
- You need to get everything organized.
Once you know how much you need to pay, you also need to ensure that all your correspondences are right and all the charges are being well communicated to you. Start by updating your mail addresses, postal address, contact numbers, etc.
It will also be good if you get a fresh copy of all the terms and conditions, along with the minimum balances to be paid so that you’re not defaulting. Also, if there are any debt collection agencies involved, make sure you speak to the concerned authorities and never ghost them.
- You will need to examine your bills and finances.
Make sure you have all physical and virtual copies of your bills that are outstanding and need to be paid. You should also account for the standing deductions, which are automatically processed from your credit cards like your OTT Content subscriptions, EMI of previously purchased valuables, mortgages, etc.
This can also be a perfect time to cancel all the useless subscriptions, as with a credit card, we often end up having certain things, which are not needed, and still, we end up paying for them, like Gym and club memberships.
- Start off by paying bare minimum.
Once you have analyzed your finances and the debt you owe, you will have to find a good regime, so that the debt does not become crushing. The best recommendation will be to find the interest rates and amount owed against each debt and start paying the one with higher interest or higher amount with lump sum numbers, and focus on paying the bare minimum for the rest.
That way, you will not be defaulting and once, the biggest burden is off your shoulders, you can gradually proceed to others with less headache.
- You have to cut your expenses.
While you continue doing this exercise, you will have to reduce your other unnecessary expenses. Start by cutting them altogether. Remember your income is limited, your expenses must not be unlimited and exceed your income and income receivable.
- Look for alternate sources of income.
You can also look for ways to increase your income. There are so many places, offering part-time job, or consultancy work, or even work from home, considering your area of expertise.
You can network with people online and come up with a decent solution, which can actually help you to land a job with a substantial increase in your income, which can help you out of this tough fix.
- You can try selling off your useless possessions.
Everyone has things, which they no longer require, but still keep it because it belongs to them. Start by identifying those and you can participate in a garage sale, or sell them on eBay. This will help you in a windfall gain, which you can easily use to settle your debts.
If you have a rack full of shoes or clothes, which you do not need, sell them off and release your burden.
- Never Ghost your collection agency.
This is the last thing that you would ever do when you have a lot of debt. No matter what you do, never try ghosting the collection agency in order to evade your debt. These agencies are quite adept and know how to get things done.
Over to you…
On top of that, these agencies are connected on a global level, and international debt collection is quite active.
So, if you think you can evade your debt, you are wrong as this will lower your credit score and also hamper your reputation. So, what are you waiting for? Apply these techniques and pay off your debt.
