Debt Recovery

Learn How To Dig Yourself Out of Debts

There are several reasons why people can’t escape the so-called “debt cycle”. A lot of people borrow money either because they want to purchase something they cannot afford at the moment, they want to use the money in starting up a business, they don’t want to use up their own money, they wanted to build their own house or buy a new car, they need to send their children to college, or  maybe they just want to head off on holidays.

No matter how serious or superficial these factors may be, the thing is you can’t bury yourself into too much debts that can only worsen the situation in the long run. The following are basic tips that will guide you on how to dig yourself out of these inescapable debts.

Cut down all your credit cards.

Using credit cards or store cards can be appealing in a way people find convenience at it. And there’s a connotation set in mind that credit card allows you to purchase items even without the cash itself. Hence, it is no surprise that most people are encouraged to use them for shopping sprees, going to restaurants, or taking a gasoline. Credit cards may be beneficial if you know how to use them well. However, some abusive cardholders cannot refrain themselves from consuming their credit limits which obviously results to amounting too much of what they owe. And what’s worse is the failure to pay the minimum amount due on time. Some cardholders are not aware of the additional and hidden charges that can be applied to their account due to late payment. If you’re this cardholder type, then maybe it’s about time to cut down all your credit cards before you pay the price of being buried from your debt.

Stop borrowing.

Now that applying for loans is made easier with the newest peer-to-peer lending services online, more and more people are surely making their way towards these opportunities. There’s nothing wrong with borrowing until it becomes a staple part of people’s lives. Most people depend on borrowing alone without realizing this will only make the situation worse. If there’s a single best thing that you can do to avoid getting buried into debt, it is to stop borrowing especially when you’re not certain about making a payment ahead of time.

Do not take new loans.

Never take new loans when you still have an existing balance in your account. Taking loans over and over again will only add up to your pool of loans until you find yourself floating from your own debts. You’ll only get drowned if you can’t pay all these so better dig yourself out of debts starting today.

Avoid purchasing unnecessary items.

Stop luring yourself by taking unprofitable things that you’ll only dump at home. Some people put their money on unnecessary things just to impress the others or just because the advertisement is quite inviting. Similarly when you buy a 110-inch television despite the fact that you already have TVs at home. You can invest your money to more important things rather than spending on something that would only cause you headache in the long run.

Save for yourself.

You can’t survive this life by depending on lenders alone. Imagine living a life without debts where your whole salary falls only into your hands and where you don’t have to think about payment due dates and late charges. Imagine how much money you can save when you don’t have to pay for these loans every month. Another way to keep yourself away from debt is to save (a lot) for yourself so you don’t have to rely from tempting credit cards and personal loans whenever you feel like spending.

Change your lifestyle.

Living a simple life won’t make you less of who you are. Try to change your lifestyle so you can improve your saving. Some tips to guide you on the process:

  1. Avoid spending too much on labeled items. Sometimes it’s good to find sale items, freebies, and discount coupons when shopping;
  2. You can also cook for your family instead of taking them to fine dining or high-end restaurants. Cook your packed lunch for work to decrease your daily allowance;
  3. Staycation can be more fun if you spend it at home rather than in luxurious hotels;
  4. When going on a grocery store, have list of important and necessary items. You are not supposed to buy something else aside from what you see on the list.

Sarah Contreras holds a bachelor’s degree in Communication with expertise in advertising and media marketing. She currently works as a web content contributor for Marketlend Debtor Finance, the first peer-to-peer lender in Australia. What motivates Sarah to keep writing is her passion of providing information to all readers out there.