What To Do With A Huge Debt?
Are you having sleepless nights thinking what to do with your huge debt? A lot of us in one way or another may have been in this kind of scenario and have probably used some of these helpful tips below in paying off a big debt. Take your time reading them and find out for yourself if they are realizable under these circumstances.
1. Make a detailed budget
Knowing exactly what are your recurring bills or expenses for the coming months will help you budget your earnings. There are fixed expenses that we have to deal with and we should set aside money for these types of expenses like: rent/mortgage, food, transportation or fuel and other utilities (water, electric, heating and phone). For the unexpected expenses that may come along the way like a replacement for your car tire or a wedding party that you have to attend, then, if you have excess money or savings, you need to make the necessary adjustments to make both ends meet and still pay off your current debts. Never put hold paying your debts because this will only lead to additional penalties for delayed payments.
2. Be thrifty
Managing your current expenses properly is the best way to save money and pay your debts. Avoid unnecessary expenses like buying clothes because they are on sale. At the end of the day, you might regret having bought that item and it was just a waste of money, since you still have enough clothes that are still with tags that have not been worn yet. If your work place is just a walking distance, why not break the usual car ride and give yourself a good form of exercise by walking your way to the office. This would benefit your health, since walking is good for the heart.
3. Find another source of income
More and more individuals wanting to earn more juggle two to three jobs whenever their main jobs allow them. Some opt to do extra hours beyond their normal work schedules to earn additional income, while others who cannot manage to do other jobs, involve themselves into small home businesses which could be their hobbies as well like baking goodies that they can sell to their colleagues at work, friends and neighbors. These added resources to your current income will surely help pay your debts in a shorter period of time.
4. Do a garage sale
Unknowingly, over the years we have already piled up things that we haven’t used or taken out from their boxes. This is the perfect time to remove the clutter and get some cash from these things. Hold a garage sale in your area or do what others are doing, selling their stuff online. Again, all the cash generated from the sale should be used to pay your financial obligations to lessen your worries.
5. Assess your debt payments
Make a detailed calculation of all the payments you have made so far from your huge debt. Assess your current balance and see if all these money saving actions have contributed a big difference to the progress of lessening your debts. If you think you have succeeded in your target goal of paying your debts on time, then, continue managing your finances and follow the rest of the money saving tips that has helped you carry on with your motives and that is to become totally debt free in the end.
Debts in general affect our overall outlook and performance in life. They can give us a lot of sleepless nights, stress and unhappy mood feelings. Don’t put yourself to this kind of problem. Debt will never go if you just let it pass by without doing any concrete financial management on your part. Deal it the right way by carefully planning and managing wisely your income. Never declare yourself bankrupt just to become debt free. This action may affect your credit rating score and would be hard for you to file a loan when you really need it most during emergencies. Be a wise spender at all times.