Despite the mounting advice and information, people fall on hard times with surprising regularity. Reports indicate the Americans collectively owe over a trillion dollar in credit card debts. If the debt is threatening to take over your life, don’t resign yourself to a life of misery and missed opportunities.
You too, like many before you, can fight their way to a debt-free existence after paying off all that you owe. If you’re keen to improve your financial situation, here are some additional steps to take in addition to jumping at the opportunity to refinance your home in Utah.
Don’t get hung up on the debt
It’s common to feel helpless in the face of debt that is accruing interest faster than you can pay off. However, that’s the last thing you need to do whenever you’re faced with such a dire situation. You’re not powerless against the debt, clueless maybe, but not helpless.
You only need to steel yourself in preparation for the uphill journey that is yet to come. Instead of going down the destructive path of self-blame, do the exact opposite. Focus in brainstorming ways to get yourself out of the cesspool and back on the green.
You need to reconcile with the current situation and forgive yourself for the past misdeeds that led you there. That might sound ridiculous, but you need that mental shift if you’re to forge ahead on full steam. As with grieving, acceptance is an excellent way to gain closure.
Refine your money skills
If you’re carrying too much consumer debt, chances are that you have poor money management skills or can benefit from improving your skills. Creating and following a personal budget makes an excellent start. A budget helps you track your income as well as expenditures.
As a side benefit, it offers an in-depth insight into your spending habits. People are often surprised to find out just how much money they splurge on night outs, takeaways, and other unnecessary treats. Only by identifying your pitfalls can you work on eliminating them.
In addition to following a budget, it’s helpful to brush up on your financial skills and knowledge. Luckily, there are many books, free courses, and blogs on money management at your disposal. Make the time and soak in as much information as possible.
Formulate a plan of attack
All the financial information in the world won’t help you with the debt situation if you don’t come up with a debt repayment plan. Treat the repayment plan as you would a fitness habit – start off slowly and build up to it.
The first step entails making an exhaustive list of all the amounts you owe, the interest rate, and minimum repayable amount.
While there are many debt repayment plans, many pundits seem to favor the avalanche methods. It entails making keeping current on all debts by paying the minimum amount then using the surplus money to pay off the high-interest debts.
Credit cards often carry interest rates of up to 17%, making them a huge money drain. Eliminating quickly saves you a significant amount of money that you can use to pay off other debts.