Personal Finance: Awesome Ways To Get Out And Stay Out Of Debt

| April 6, 2016 | 0 Comments

Getting out of debt is one thing, but staying out of it forever is another. If you are in debt, you will suffer from the temptation of trying to get out of it as quickly as possible. After all, no one wants to be in debt unnecessarily. However, these methods tend only to work in the short-term. In the future, you could easily fall back into the same trap as before.

No one wants to spend their adult life yo-yoing in and out of debt because it isn’t healthy. For that reason, you need to tackle it constructively so that it disappears for good. Obviously, it is a lot harder than it sounds because it does sound quite easy. But, it is possible if you take the necessary steps. As long as you are patient, the following tips should set you up financially for life.

Hire A Good Accountant

Accountants save people from the brink of bankruptcy all of the time. If you pick wisely, they will do it for you too. Because they are money professionals, they know all the tricks of the trade. For example, they know when they need to pay a bill and when they don’t. They also know how to cut costs without damaging your lifestyle. In short, they know a lot of things that you need to exploit if you want to become debt-free in the future. The best way to find a good accountant is to arrange a sit-down meeting and ask them questions. Ask them about their previous record and how they plan on saving your finances. Any half decent accountant should have a plan to solve your problems.



Get A Lawyer

Sometimes, even an accountant won’t be able to stop you from going bankrupt. Don’t worry because bankruptcy isn’t as bad as it sounds. Okay, you will struggle to get a loan from a bank, but you won’t need one with Kenneth Carp Law Offices. KCLO is a firm that specializes in bankruptcy and debt-relief. You can view online at Kenneth Carp Law Offices if you want to find out more. The pertinent points are that they have plenty of expertise and knowledge, two traits which are essential. With the help of an expert law firm, you can maneuver your finances so that you don’t have to deal with debt again. Think of it as a blank slate as the lawyers wipe it clean. You will have to declare bankruptcy, but you will get a fresh start.



List Of All Your Debts

The first step if you plan on going it alone is to list all of your debts. This is a key move because you need to understand your debts before you can take action. Lots of people suffocate under the pressure of being in debt, so they don’t know the true damage. You can’t just try and sweep it under the carpet because it won’t magically disappear. Instead, you need to take action and be proactive. As well as the debts, list their balances and interest rates. The more you know about the debt, the better.

Set Long Term Goals

Wow, that is a big number! Still, this is no time to panic and think the worst. Any situation is retrievable as long as you take baby steps. The important thing about a goal is that it breaks the number down into smaller, more manageable chunks. What at first seemed insurmountable is now quite a reasonable number. All you have to do then is figure out how much you can afford to pay back. That number is based on your total incomings and outgoings each month if you aren’t aware. Use this to calculate how much time you need to repay the debt or debts so that you know how long you have to bear the burden.



Start Paying Off Debt From Highest To Lowest

Highest to lowest what? Highest to lowest refers to the typical APR the loan is accruing each month. APR is interest that adds to your repayments, so you want to keep the lowest and shed the highest. Some tipsters like to encourage people to pay off their smallest debt first to get the ball rolling. Although that might affect your mindset, it will cost you more. The biggest debts have the biggest interest rates, which is why they need to go first. Okay, the small ones accrue interest too, but that is minimal in the grand scheme. What you should do is set the minimum payment for every account bar the biggest one. Then, you can set more aside to tackle that one while steadily decreasing the others.


Transfer Your Balance To A Credit Card

This is a neat trick if you can find a credit card that offers 0% APR for the first year or more. With this introductory period, you can consolidate all of your debt into one big debt. Although that sounds contradictory, the 0% APR means that you are paying zero interest on all of your debts. It does sound too good to be true, and it is in some cases. The issue that you will face is trying to get a card company to greenlight the deal. With your current financial record, they will want some form of security to make sure you don’t default. One form of security is not to offer you the deal in the first place.


Joe Wolf on flickr

Sell Your Valuable Items

Selling your valuables isn’t always a good idea because you will need to spend more money to buy them back. A good compromise is to sell your ‘big ticket valuables or the ones that have the best resale value. The price indicates that they are important, but you can live without them for the time being. Take your car. A car demands a hefty price, and you can walk or catch the bus. Yes, a car makes life easier, but beggars can’t be choosers. If you have a couple of these items, you can eradicate your debt quite quickly.

The final thing you need is patience. Patient people are the ones that succeed because they can see the bigger picture.

Category: Personal Finance

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