You have gone and done it, finally. You have a good job, it pays enough to do what it needs to do and now it’s time to start saving a little. But it doesn’t happen. No matter what you do, you can never seem to keep enough aside and actually keep it there. Something always pops up. While you never miss a bill, and there’s food in the cupboards, you just don’t have enough to save either.
The real problem is that you are up to your knees in debt, and every spare penny you get seems to go right back out again. Your debt level is dropping, but it just doesn’t seem to be going anywhere quickly and you know that just one late payment could escalate things further. What do you do?
You may be tempted to take an adverse credit secured loan, to consolidate everything and make things easier. If your situation is a little worse, or complicated you need another plan.
Follow these simple steps, and you won’t just put a real dent in your debt – you just might kill it off entirely.
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Common sense is one of the best senses you have
The biggest reason people accumulate so much debt, is because of how easy it is to obtain credit. A lot of the time, people miscalculate just how much they have spent and before they know it, the angry letters are coming. By far the best way to keep track of your spending is by paying with cash. For everything. Any credit cards should be seen as emergency sources.
Using cash, and being able to see how much is in your hand, you will gain a greater appreciation for every penny you have earned.
Say no to the impulse buys
Want to know the best way to save? Don’t spend. Essentially, if you don’t need it then don’t buy it. This means movies, luxury items, takeaways, that new album that keeps been played on the radio… Curb your spending, put the money you would have spent on that new video game on your debt and you WILL reduce it.
Come up with a plan
It doesn’t have to be a cunning one, but you do need one. “If you fail to plan, you plan to fail”. Write down your total debt, and how long it is going to take to pay off at the rate that you are currently paying it. Next, you need formulate a budget. Make a list of all money that comes in, and a list of all money that goes out. All of it, every penny.
Once you have a better idea of where all the money is coming from and what it is being spent on, you can move forward.
It’s time to cut back
It’s possible that you have more money left than you thought, so where is it going? Remember those impulse buys? They didn’t make the list on your plan did they? Didn’t think so. To further increase your available funds, and get that debt down, go through your list and eliminate anything that you don’t need, and reduce anything that you can.
Remember, this is not a permanent lifestyle change – these are temporary measures designed to eliminate your debt. Think of it as being like the austerity measures that have been gripping countries recently. This is basically the same thing. Once you’ve cleared your debt, you’re free and clear – and so are your finances.