Almost all of us like to be sound on money and to be able to spend or save cash as we wish. But there are some others who like to be financially strong but at the same sinks in debt. This situation is as common as cold from a school going child living in a hostel to an established businessman would’ve have had debts, whether big or small, at some juncture in life. While growing short on money and even to the point of being in debt is a good warning for us to reduce our expenses, some of us still find it difficult to overcome debts. Overcoming debts is not just about paying back your loans, it also includes good management of money, a sound and strict reason when it comes to warding off unwanted purchases and expenditures, as well as planning and practice. This takes time and effort and can be a little trying but never impossible. Let us walk through a few tips that would help with managing money, paying off debts and staying away from it too.
10. Get rid of your credit cards
While it is true that most prefer having their money deposited in banks rather than keeping it in hand for reasons such as to avoid spending or having to manage the surplus cash, what we fail to see is that this can also take a toll on our spending habits. We do feel conscious of how much we spend when we pay in cash but this is often not felt when the transaction is done via cards. If you have this tendency to spend on your cards, force yourself from using the cards. You can hide them, or leave them locked so you do not spend more unnecessarily. Do this until you have become stable on your habits and spending. This is also a safeguard from not throwing yourself into a deeper debt.
9. Chart it out
Try this little technique that would help you to better manage your debts. You could keep up a statistic of how much is your debt, your income, must have expenses and those that can be avoided. This would give you a strong idea of how much to spend where and where not. This planning would make your mind to automatically keep a tab on your spending habits and will also boost your saving. Frame a budget for each month or for keeping it easy, a week. Stick to it and mark down what all you need for the week and do not exceed the budget plan. Adhere to it and also make a record of how you stuck to it as a token of your little success.
8. Want it or need it?
If you are a shopaholic and neck-deep in debt you need to stop your sending pattern. Like right away. Plan your purchases and make sure to ask yourself twice whether you ‘want’ it or ‘need’ it. If you are able to not spend unnecessarily and to keep a tab on your spending habits, you could fix your debt easier and better.
7. Opt for a simpler lifestyle
Take a deviation from your usual, posh lifestyle and opt for a simpler one without excess expenditure. This is another short cut to clearing up your debt easier and sooner. You will start asking yourself the requirement of the purchase, the next time you are driven by another shopaholic temptation.
6. Open up extra sources of income
Would a little extra income hurt? Look up internships or a side business that would help you earn a few extra bucks. If you are good with your language, go ahead as a freelance writer. If you have a good hand at art, bring it to the surface. Whatever be the skill, put it to use and earn from it. The more the money that flows in through this channel, higher are your chances of getting rid of your debt.
5. Emergency funds
In the heat of paying off one’s debt, we often tend to invest every extra penny into resolving the loan and forget to set aside a little for the emergency situations. While it is trying enough resolving your debt, and rephrasing your lifestyles, make sure you to make it a point to set aside some emergency cash. Would you rather borrow again for your emergency and thereby jump from one debt to another? Be wise in your plans and set aside certain fixed amount for your health care or other emergencies and do not pick on it when times are blue unless you can see into the future and know for certain the guarantee of good health and a promising, uneventful future.
4. Avoid paying fees
Bills are and always will be an unpleasant part of our modern lifestyles but will procrastinating paying it off help? Make sure you pay your bills on time before they mount up with fees. Every penny counts here so make sure you organise your bills well and keep them cleared. Unless you have a money tree in your backyard which would take care of your debt clearance, let us stick to not spending the extra dimes.
3. Opt for balance transfer
Set aside a couple of minutes to get in touch with your various credit card companies and enquire of them if they can lower your interest rate or if they provide anydeb special interest of balance transfer. With this fixed, consolidate your loans into those cards that has favourable interest rates. Keep a check on their balance transfer fees and that this is actually paying off your debt.
2. Reuse and recycle
Instead of buying up new stuff, try to reuse and recycle. These could be really simple stuff like instead of buying new drinking bottles, wash up the old one and refill them; even with your clothes, try to create different designs and pairs from your wardrobe itself rather lavishing on new dresses etc. These little savers go a long way into resolving your debt and keeping you out of it as well in the long run.
1.Keep yourself around the right type of friends
Wouldn’t all your efforts go up in flames if your company includes spendthrifts? Make sure you have the right friends around who will encourage you to alter your shopping fashions and lifestyle and help you towards resolving your debts. Their support and presence will help you to better face this situation and to resolve this in a more efficient manner.
Remember that each penny is your hardwork and if you splurge it on unwanted luxuries, you will be borrowing from your future income. Think twice before you make an investment and think thrice before you spend for the extras.