So it’s 2022 and you look back, pondering deeply: how can I finally get out of debt? What can help me get my debt under control?
From someone who also faced debt in the past, let me help count the ways for you. Here are 5 tools that can help you get your debt out of control:
Create a budget and stick to it. This is so basic but so many people end up in debt simply because they do not plan or know where their money is going. List down your expenses (rental or housing payments, power and water bills, fuel or fares, groceries, etc.) It is also helpful to update this budget yearly as there may be an increase in costs.
Don’t forget that your expenses needs to be less than your income. More money going out really just spells debt and more debt. This brings me to my 2nd point.
Consider increasing your income. There was a time when I kept thinking why my joint income with my husband was no longer enough for our expenses. We kept trying to cut costs but we were still struggling. We finally had to face the reality that as costs of power rates, fares and grocery products kept increasing and with our commitments to give, we need to also consider increasing our income.
On your end, this may mean taking a 2nd job. Or what about a side hustle like selling items? If you can sing or play an instrument, perhaps you can offer classes or even perform in gigs. Explore possibilities. Be creative.
Explore Debt Consolidation. This may just be what you need. You might be surprised to know that you can actually learn more about this and access a service like this online.
I admit that in the past, I did not really know about this. But as I’ve said it might help you to understand what it is and even try it. To know more about debt consolidation as well as debt settlement and credit counseling, just click here.
Pay off debts and celebrate small successes. What worked for me was to list off my debts and start paying from the smallest amount to the biggest one. This is what is commonly referred to as debt snowball.
By doing debt snowball, I was able to easily see my success in paying off my debts. It helped me see “the light at the end of the tunnel” faster.
Cut off or limit credit card use. I first got my credit card when I was just a few years in the work force. I did not understand a lot about it. And I ended up doing a one time emergency cash advance which I ended up being burdened in paying off.
After finally paying off that debt, I cut off credit card use for many years. In fact, almost 20 years passed before I got a card again. And only because, my savings back called me an offered me one. I thought about it, prayed about it and felt that it was time to try having a card again. I’ve learned my lesson well. No more cash advances for me. I also make sure to only use the card for items I can pay off.
I hope that these 5 tools or ways of getting your debt under control have been helpful for you. Stay tuned as I intend to write more about tackling debts and financial tips in future posts.