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Top 7 Ways to Get out of Debt

Top 7 Ways to Get out of Debt

Getting out of debt is only possible through strategy. Those experienced know it takes proper decision-making to pull this move through. You must also be patient because this takes time and calls for courage. This is true because you may have to give up some of your most valuable things. Here are seven ways to get yourself out of debt.

1. Plan

This has always been the first step to anything. Debt recovery must always be planned for. You must be aware of the total debt you must pay and adequately prepare for it. Debt must also be compared to your income, and analysis was done as to how the two will match.

You must also keep in mind that as you clear your debt, you’ll be living a life. That means you’ll have to spend money on other expenses like upkeep. That’s why you need to plan.

This is necessary because it must make sense on paper to become a reality. Things that are impossible through imagination can be twice harder to accomplish.

2. Borrow no more

No matter how hard things might get, you must stop borrowing. The truth is, you can never get out of debt if you keep borrowing. Let’s think about this deeply.

You want to get out of debt. That is your endgame. Instead, you should ask yourself how you can get out of debt if you keep borrowing. That’s technically impossible.

The only way to get out of debt is through halting borrowing. You cannot get out of debt if you keep borrowing. It’s mission impossible.

3. Consolidate your debts

Borrowing can become addictive. Lenders lure borrowers into taking more money from them, and that’s why you’ll find yourself borrowing again and again for no good reason. That should not be the case.

The more loans you have, the higher your chances of defaulting some. In most circumstances, we borrow because we lack. By borrowing, you reduce your future disposable income, which means you’ll lack more. If you don’t do something about it, you may end up suffering more.

4. Engage your lender

The law protects its own. That’s why you shouldn’t be afraid of anyone. That lender threatening you is the source of your problem. And that may be your solution in the long run.

Some debts aren’t what we received but an accrual over what we owe. Engaging your lender can halt more accruals and have lesser amounts to pay back. This will make your repayment plan easier to create and manage.

5. Pay more than the premium amount

When taking your loan, you get a certain amount that you’re supposed to pay back. But, unfortunately, that’s the minimum you can pay, which means you can pay for more. So, to clear your loan faster, spend as much more as you can. 

That way, you’ll settle the loan on time and quickly get out of debt. Once you’ve achieved this, the next step would be to put your money on other projects and grow your wealth.

6. Avoid shylocks at all costs.

If you’ve dealt with shylocks, you know what they’re capable of. These are individuals who lend out money and aren’t regulated. For that reason, they have self-imposed powers to charge what they want. So avoiding their deals is a great way to get out of bad debt.

7. Pay debts before acquiring more debt

You should have debt limits. Do not exceed these limits at all costs. That way, you will avoid piling up debts without plans. Stay debt-free so that when you get into debt, it’s easy to opt out or pay the debt.  …

Saving for that Next Big Thing: Tips to Make it Happen

Saving is a difficult undertaking especially if you already struggle to make ends meet. The thing about saving is that it is a good thing and will help you in the long run. So, no matter how small your monthly contributions, you should try to save a little bit every month. There are many saving tips all over the internet. We would like to point out a few that are very important in our opinion.

 

Use automatic savings options – This is a very good way to make sure that you save money every month. When you have to do it manually, it’s easy to convince yourself that there are other things it is needed for. So, make an arrangement with your employer or bank to withdraw a set amount of money every month. This will go straight into your savings account and you won’t even notice it. If you don’t have control over it, it makes it easier.

Set short-term savings goals – In many things thinking of the big picture is the ideal. However, if you struggle to save you may want to try more short-term goals. For example, try to save $20 a week for 3 months and then up it to $25 every week, etc. Once you get into the idea of it, you can start looking at monthly goals and take it from there. Saving small amounts over a short time is easier to manage than one large amount.

Use windfalls and tax refunds for saving – Sure, you look forward to those big amounts to go on holiday or buy that something you’ve had your eye on for months. However, the smarter choice is to take a part of that money and save it. Add it to your retirement fund or the savings you want to use for a specific goal.

Save your small change –  Have a jar at the door and throw all your change of the day in the jar. You will be amazed at how fast those coins add up. Once the jar is full, take it to the bank and deposit it to your savings account and start again.

When you approach saving in small steps and wisely, it becomes a lot easier. Saving for your next big thing should be good motivation to try out these simple strategies.

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