If you find debt is difficult to manage, a credit counsellor can discuss your overall financial situation and help you develop a personal debt management plan. They can propose debt-forgiveness solutions, such as debt-management programs, credit consolidation, and debt regulation, to get things going and prevent consequences such as going bankrupt. Put all your debts into a payment plan, paying a single monthly instalment to the credit counsellor and paying your creditors, then you will be on the path to financial freedom!
Serious credit advisory organizations can advise you on how to manage your money and debts, help you develop a budget and provide free educational materials and workshops. Many organizations, such as Debt.org, offer advice and support if you need help with the first steps towards effective debt management.
If you are struggling with significant credit card debt and cannot arrange a repayment plan with your creditors, you should seek debt relief, credit counselling or debt settlement. The first step towards effective debt management is to admit that there is a problem so that you can address it by taking the correct steps and overcome it. One of the smartest ways to get out of debt is to see a credit counsellor. That said, while this can be helpful, you should only do it when you are desperate.
Start by making a list of all the different types of debt that you can hold back on your monthly payments, such as mortgages, cars, student loans and credit card debts. A good debt repayment plan can help you focus on the money you have to repay the debt and speed up the time it takes to clear your debt.
If you haven’t developed a budget, one of the first steps to getting out of debt is developing a budget – a plan for how you spend your money each month, that takes into account what you earn and how much you earn. Before beginning your debt repayment plan, take the time to calculate the base budget – the minimum amount you need to pay your basic bills. The total amount you must pay each month should be less than your discretion, which determines how much money you can put in debt each month. If you only pay the minimum amount, it will take a long time to pay off your debts.
Instead of paying credit card debt, for example, you put extra money into student loans, mortgage debt or excessive interest on your credit card. Another way to concentrate is to take a sheet of paper the size of a credit card and write off five of the debts you want to clear off.
There are many different types of scenarios surrounding debt you might find yourself in, not least of which will require a tailored strategy to escape. That’s why a secured party creditor is probably your best bet, with extensive expertise and experience to map a pathway to complete freedom. Complete freedom from the clutches of debt is indeed possible, but you should make no mistake about the fact that it’ll be a serious challenge that requires your full engagement.