Are you struggling with debt? You are not alone. Every year, around half a million people file for bankruptcy in the United States. Millions more are struggling with debt without a solution in sight.
Many people who are struggling with debt do not even realize how much they owe. That is because debt comes in many forms. Most of us think of things like car payments and mortgages when we think of debt, but student loans, medical bills, and everyday expenses added to credit cards can also quickly rack up your outstanding debt.
The first and most crucial step for those who want to get out of debt is to find out just how much you owe. Once you know how much you owe, you can make a logical and manageable plan for paying it off.
How much are you paying toward your overall debt each month? For many people, the answer is the smallest amount possible. Paying only the minimum balance toward debt might seem logical now, but it costs you a lot more overall.
Increasing the amount you pay toward your total each month – or putting money toward these totals more frequently – will slash those outstanding totals much faster. Bump up the amount you are putting toward debt repayment wherever possible and see just how much your efforts pay off.
How many of us rush to buy things because we see others using them? If that does not sound like you or your family, consider whether you update your wardrobe every season or invest in new technology before you must. Too many times, we see these lifestyle upgrades as necessary when they are well beyond our means financially.
If you find yourself chasing the lifestyle of those around you or worrying what they might think of your clothes, your car, or your computer, it might be time for a reality check. These expenses are not necessary – and cutting them out will help you recover from debt much quicker.
There are so many reasons people might buy something on impulse. Maybe you want new clothes for an upcoming event, or your child insists that they need new shoes. Maybe your couch is starting to sag in the middle a bit or you hate that your computer is so slow when you try to watch videos or play games. Those are valid concerns, but not necessarily reasons to invest in something new – especially when you are struggling with debt.
Consider making a budget for your household and including only the necessities. Repurpose old clothing, fluff your sofa’s pillows, and make do with your computer for now. When you finish paying off debt, you will feel even better about making those upgrades when you can actually afford them.
Another misstep many people who are struggling with debt make is failure to set up some kind of savings. Without savings, you are not prepared for the emergencies that often lead to debt in the first place. Prioritize debt repayment, but also work toward putting some money in savings whenever possible. This way. You will be prepared for emergencies – and not have to rack up more debt when they arise.
There are plenty of everyday expenses that we cannot avoid. These include food, fuel, medication, housing, clothing, and even some degree of entertainment. In today’s world, you really cannot be without access to the internet, which is also an everyday expense. All these things add up quickly to leave many people struggling with debt just from life’s little costs.
Thankfully, there are many ways to save on these costs – but not everyone knows about them. Many public programs exist to help families struggling with debt to afford these necessities. Whether it is food or fuel assistance, clothing closets or charity shops, you can keep your family’s basic needs met without spending your entire paycheck.
If you do not qualify for these programs, though, plenty of other resources are likely just waiting for you in your area. Libraries and community centers offer access to the internet, training materials for employment, homework help for students, and more. Discount retailers offer cheaper alternatives to everyday groceries and personal care items, and secondhand stores or thrift shops make it easier to clothe your family and furnish your home.
Keeping these everyday expenses down can help you dig yourself out of debt – and continue living a comfortable life in the meantime.
What does your debt repayment plan look like? If you are like many families who are dealing with unmanageable debt, your answer might be that you do not have one.
Failure to plan for repayment means that you might not know how to attack the looming debt that is hanging over your head. You might not know which accounts need repaid in which order, how much you can pay toward your totals, or even if you are falling behind on repayment. This can lead to profound consequences if creditors turn your accounts over to collections agencies. The best way to avoid this is by having a clear and manageable plan in place.
There are plenty of ways to attack outstanding debt, but not all of them work for every person or family. Getting professional advice may be necessary to help you figure out which approach to debt relief is best for you.
Bankruptcy might ultimately be the best option for those struggling with debt. While this can take months or even years to complete, it can give you the fresh financial start you need to rebuild in the best possible direction. It can also free you from the stress of constant calls and complaints from creditors that you cannot repay.
If you are interested in learning more about bankruptcy – and the best possible bankruptcy scenario for your unique situation – contact the Van Horn Law Group today. Our team of experienced professionals can guide you through the process from start to finish and help you get back on your feet financially. Whether you are sure bankruptcy is the best way forward for you or simply want more information, give us a call today!
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