Perhaps one of the most important aspects of allowing you to feel free and truly independent in this world is to clear debt. In other words, if you don’t owe anybody, you have more control over your life and are only responsible to yourself and your family. This article considers a whole host of clear debt solutions that can set you on the right path to financial freedom.
Obviously, the best scenario is to not to get into debt in the first place, but some things like university education, cars and mortgages require them. Some may see them as unavoidable. This aside, there is a lot of unnecessary debt that people fall into, and this article attempts to assist individuals and families to start to get out of debt and help make their lives more independent.
1. Avoid getting in any extra debt! If you can’t afford it, don’t buy it!
2. Create a budget. In this scenario it is vital that you know where you are spending money every week. Only then can you know how and where you can begin to spend less and start to make savings. Keep a spreadsheet if you want and make it a target to reduce your expenditure in each column each month.
3. Change your spending habits. Many people pay a little bit too much here and a little bit too more there. Basically they waste their money for no discernible improvement in life. If you start to change these habits, you are more likely to save money than incur debt.
4. Clear any monthly credit card balances as soon as you can. If you pay off your card in full at the end of each month, you don’t incur any interest charges and you prevent any existing credit card debt getting larger and won’t have to worry about >negotiating credit card debt. Make no mistake that the task of trying to eliminate unsecured credit card debt is far from easy, so try to minimise it in the first place!
5. Avoid temptations. Many people are in debt simply as a result of clever marketing and advertising techniques that tempt and persuade you to spend money on something that you don’t need, or to spend on a more expensive model than your require. If you can, try not to spend too much time watching TV as this is the biggest thing that will persuade and tempt you. Think of all those shiny new cars that you are told that you have to have. Or even small items like chocolate bars. Saving a few cents per week on small individual items that you don’t need, all adds up!!
6. Be careful with who you mix with. Perhaps the biggest reason for people spending more than they need is peer pressure. The so-called ‘keeping up with the Jones’’. If you are continually mixing in circles of people who boast about what they have, it can be very disheartening and difficult to stay financially responsible. If your friends are causing you to spend more than you should, and hence making you miserable, you really need to ask yourself whether you need those friends in your life. Also, don’t forget that they may also be in a stupid amount of debt – but nobody likes to brag about that.
7. Consult any free debt advice charities or agencies that exist where you live. Consider debt elimination services that consolidate your debt into one monthly payment. A debt reuction company like this should have a multitude of debt elimination programs to help you gain positive momentum.
8. If you begin to have a surplus of cash each month and you have a mortgage, think about starting to pay off the capital on your mortgage. In this way your monthly repayments will gradually be reduced, all things being equal.
9. If you have any savings or inheritance, use it for clearing debts. This is likely to be much more efficient and prudent in the long run.
10. Focus on your mind about why you want to clear debt. Make no bones about it; having debt can be a great weight on one’s shoulders. It can weigh physically and mentally and have a massive negative impact on your health and relationships. The chances are that you want your health to be good, so focus on this and make it your reason to be determined to clear debt.
11. Give yourself small targets towards your goals. For example, in the first few months your targets may be to start saving just a bit. Then you may focus on using your savings to pay off existing debt. As you clear the debt you will begin to save even more and have the means to pay off even more debt. There will be a positive snowball effect.
12. Take responsibility for the debt. Ascertain in your own mind that the debt is yours and you are responsible for eliminating it. Blaming anybody else, no matter what the reason, will not help!
13. Think about the difference between what you need and what you want. It’s difficult in this media age when you are constantly being bombarded with slogans that complicate matters, but deep down you know the answer already. Most people need a car, but most people spend more than they should. Everyone needs clothes, but most people spend more than the need to. You get the picture. Everyone needs to eat, but just about nobody needs to spend more by going to a restaurant or fast food place.
14. Keep yourself motivated by making tangible gains. If you prove to yourself that you can cut your expenditure in the first month, you have the momentum to continue. If you can only make a small gain, then make it. It’s a great start!
15. Treat yourself. If you make your monthly target, allow yourself a small and inexpensive treat that helps you bask in your glory and keep you motivated.
16. Get over the social stigma that you perceive is linked to personal debt. You are not going to clear your debt if you don’t accept that you have it.
17. Sell things that you don’t use or need and use the cash gained to help pay off any debt you have. You’ll be surprised when you realise how few material things that you need in your possession in order to be happy. Start with things that you haven’t used for a year and have little sentimental value attached. By using these ‘useless’ items to good use to help to pay off debt, you will feel good!
18. If you have some spare time, see if there are any extra ways that you can make cash. For example, there are a multitude of online sites where you can be paid to do legitimate surveys online. Doing one survey per day for 20 minutes may allow you to save/earn hundreds of dollars per year. This may not seem like much, but for example it would more than cover your yearly internet connection charges and mean that you don’t have to worry about that particular piece of expenditure. Do two surveys per day and you may have enough to pay your car insurance. You get the picture. All of these savings produce cash that can be used to pay off debt.
19. If you have tried really hard to reduce your debt but have hit a brick wall, maybe because you have an insurmountable hurdle such as having lost your job; consider whether personal bankruptcy might be the right choice. In this case, expert advice is vital and you should begin making enquiries right away. You could try a debt lawyer iso ling as you are aware of any potential costs. The more time you leave it, the more the weight will remain on your shoulders and negatively impact your health and relationships.
20. Contact your bank and let them know your situation and what you are trying to do about it. For example, most banks apply high charges for going into an overdraft with prior agreement. By liaising with your bank, you may be able to avoid incurring such unnecessary extra costs and charges that will make your debt situation worse. They may have some vital debt settlement solutions to help you. You could even get debt elimination companies to liaise on your behalf, although it will obviously incur a cost.
In conclusion, it can be seen that much of the strategy involved in these clear debt solutions and overall aim to attain financial freedom is psychological. It’s about not spending money on things that don’t need and not feeling the stigma of having less than somebody else. If you can neutralize these emotions, you will find it much easier to cut expenditure, make savings and thus be on the road to eliminating debt. Once you have that momentum, you’ll not look back.
