Pay off debt to recover financially

September 16, 2009 at 12:28 PM 3 comments

People have learnt to live with debts. And how important it is to pay off debt is also gaining increased prominence with each passing day. When you are in debt, you may be exploring different ways that can make you debt free. But how will you know which is the right debt solution for you?

A credit counselor will be able to decide about this best. A credit counselor will first assess your financial situation and then suggest the debt relief option that will meet your current financial needs. Some of the debt solutions you may be suggested include the following –

  • Debt management plan or DMP
  • Debt consolidation
  • Debt settlement also referred to as debt arbitration or debt negotiation

The main objective of enrolling for the above debt help programs is to make your debts manageable by reducing the rate of interest that reduces the monthly payments too or by allowing you to pay less than the total amount you owe.

In addition to the options mentioned above that can help you to pay off debt, there are few other measures you can adopt to get out of debt and lead a financially stable life. These tips will help you not only to pay off debt but also manage your hard earned money better –

  • Put away your plastic cards or traps

Credit cards or plastic money are simply traps or baits. If you know the rule to handle the credit cards, they can work wonders for you. But if you are not aware of the payment policies and what they imply, the credit cards can create havoc for you. Use credit cards less. Do not add to the existing debts.

  • Budget your finances

It is very important to budget your finances. If you start off early, you will lose less cash in the long run. It is also important to build an emergency fund that can help you to pay off debts in case you sense that you are about to fall behind on payments.

If you are able to follow the above steps, it will be easier for you to manage your cash and meet your monthly financial obligations. Live within your means and try to strike a balance between your income and expenses.

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Entry filed under: Finance. Tags: .

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3 Comments Add your own

  • 1. JimmyBean  |  October 1, 2009 at 10:02 AM

    I don’t know If I said it already but …Hey good stuff…keep up the good work! 🙂 I read a lot of blogs on a daily basis and for the most part, people lack substance but, I just wanted to make a quick comment to say I’m glad I found your blog. Thanks,)

    A definite great read..Jim Bean

  • 2. Oliver Darraugh  |  October 4, 2009 at 3:25 PM

    If in debt prioritise them, priority such as mortgage or rent, non-priority such as loans/credit card repayments. All debts have to be repaid but those of priority have to come first. work on a budget, how much coming in and going out, can you make cutbacks?. Then consider steps to becoming debt free, an iva, consolidation loan or a debt management plan are all options to consider.

  • 3. REIT  |  October 6, 2009 at 7:41 PM

    Hey, I found your blog while searching on Google your post looks very interesting for me. I will add a backlink and bookmark your site. Keep up the good work! 🙂

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