Debt is the very common fact in most of American house hold. At first we take small loans to fulfill our daily requirements. If not managed well, a small amount of debt can lead us into great trouble. It doesn’t mean that you should avoid taking any kind of loans in your whole life span. Sometimes we don’t have a large amount of money to fulfill some basic needs like education or homeownership. For this we need to take out a student loan or a mortgage loan. There is a chance to get into deeper if we fail to plan the repayment.
It is not that we need a financial expert to manage our debts. We can do it on our own as well and we need not to be a finance buff to do so. You need to maintain the juggling between your repayments and monthly income to get out of debt. If you follow certain steps then you will be able to become debt free while living your dreams without any stress. Here is a list of action plans you need to follow to become your own debt manager:
Make a list: First of all make a list of your debt. Of course you are having more than one lone and several credit cards. You need to pay that all off, right? So make a list of monthly installment amount you need to pay every month. This will help you to find out the exact amount you need per month to pay off your debt in time.
Pay on time: This is a very basic step towards a debt free life. If you miss the last date of your monthly installment against your debt then a late fee will be add on. This will destroy your monthly budget which you already have planed. Then you need to sacrifice some other important thing to pay the extra amount. The logic is simple, why pay extra?
Check out your priorities: This step will differ from person to person as per their current situation. If you find a shortage of fund to pay off all your debts at a single time then make a check list. In this check list emphasize on the debts you need to take care at once. For instance if you are having a credit card of high interest rate then pay it off first.
Don’t keep all the eggs in the same bucket: This is a golden rule while it comes to managing your debts. There should be a secret or hidden account to use only during extreme emergency. Remember, you need to save a few bucks to handle tough situation or else you will end up taking out another loan.
Recognize alarming situation: If you find extreme difficulty to pay off your debt then don’t try to escape the situation. Instead try to make out some alternative way. Don’t hesitate to seek help from your near and dear one first if you get into trouble and try to avoid taking out another loan. At least you need not to pay them interest.
Now your action plan is ready. Get right into the middle and fight out your debt.