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Ways to deal with debt before it overwhelms you

Posted: July 29, 2019 at 6:10 pm   /   by   /   comments (0)

Debt can be quite overwhelming, especially when it becomes “pluralized” – debts. Many people are still struggling to cope with those debts they’ve incurred several years ago and the impacts of debt, on some people’s credit score, are still lingering around them. Luckily for some people though, their debt hasn’t gotten to an overwhelming state, which means there is still a way to deal with it now before it overwhelms you because once it because overwhelming, it might be too hot to handle.

Create another stream of income

When you are in debts, especially ones that haven’t overwhelmed you, it is always advisable for you to face the facts quickly – and the fact is that, you owe. The earlier you understand your position the better. Once you understand and appreciate this fact, you need to start acting on it. And a good way to start is to create a second stream of income. If you are a corporate worker who works for several hours in a day, you might want to consider getting into a small online business that wouldn’t really affect your office schedule. If all goes well, you may start to pay your debts gradually using whatever you earn from your side-engagement. In the end, this will help you pay off your debt, while also achieving financial stability.

Switch to 0%

If your debts come in the forms of expensive credit cards, find out if you can transfer your debt onto a 0 per cent balance transfer credit card. These clever cards eliminate interest charges for an introductory period, ensuring that every penny you repay goes towards beating down your balance. However, to make the most of this type of deal you must ensure you repay your debt within the offer period.

Alternatively, if you need longer to repay your debt you may be better off opting for a long term, low rate credit card. Although you will still pay some interest each month, it will probably be at a much lower rate.

Look out for options

When it comes to debt help, you really need to look outside and shop around. If you can shop for a market leading rate, the APR may well be friendly and lower than whatever you are paying with your existing credit card. If you really look outside, it is possible to find a market rate below 8-10 per cent, which is much friendlier than the 16-17 percent APR charged by a typical credit card. 

Exploit government established schemes

Do you even know that the government has established some schemes which are meant to help those with debts? One of these schemes is the independent Voluntary arrangement (IVA). It is a debt management plan that allows you to spread your debt payment over a longer period of time, usually 5 years. The whole idea is to cut you some slack, and afford you comfortability as you make your debt payments. However, not all debts qualify for this scheme, and it is therefore important for you to check here to understand IVA debt, so that you can know which of your existing debts qualifies for an IVA. 

Reach out to people

There is nothing embarrassing about being in debt because even the great men of the world owe. So, if you realize you might not be able to meet up with your debt requirements, it may be time for you to seek out family and friends before it becomes overwhelming. Some of them would be willing to help, while some would not. Get yourself together and move on, after all, it is you who needs financial assistance. If you are lucky enough, you might even get enough debt help to clear off your entire debt, which frees you of any debt burden.

Seek advice

Sometimes, in order to prevent your debt from becoming overwhelming, you need to seek professional counsel. There are many individuals and institutions out there today that you can approach, so that they can give you the right advise you need in terms of your debt payment. You are no financial advisor, and you probably don’t have a degree in financing, so it’s always good to seek out those who do. Many of them have handled cases similar to yours, and they will be more than happy to help you out.

Start Saving

If you are not overwhelmed by debt yet, chances are you don’t owe too much, which means you can still afford to put some amount of money into savings. If you are in this position, it’s highly recommended that you start saving gradually. In the end, you may use some of the money you’ve saved to pay off a significant portion of your debt.

Any of these tips above would always be ready for you to use. So, whenever you run the risk of being overwhelmed by debt, feel free to call on them.

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