Survive Debt

May 11th, 2009 | 26 Comments »

Are you now in a situation where your debts are all piling up on you? You don’t know which ones to pay first? You do not know how to repay all those debt given your current budget? Well, if this is the case, you need to survive your debt. Here are some simple ways which may help you in the survival process.

First, you need to be organized in terms of all your debt. How many debts do you have? How much are they? And from whom did you incur them? Then, get the total of all your debts.

Second, you must list down all of the debts you have, the entire amount you paid, the amounts you were not able to pay plus all the interests that have piled up over the years. Write them in an orderly manner so that it will be easier for you to understand them. You can write them down in columns and put heading for each so that you’ll know what the amounts stand for.

The next thing you have to do is assess your current income. You have to know how much you earn per month, and how much do you spend for basic necessities such as food. After that, you have to cut down on other spending. Say goodbye temporarily to dining in fancy restaurants or a trip out of town, or even movies.

You need to prioritize paying the debts before entertainment and luxurious things. If your current income is not enough, it might also entail a second job for you, just to get you through. You can also cancel cable television, more than one telephone lines at home, and subscriptions for magazines and the like. This way, your monthly spending will be lowered. You just have to prioritize your house rent, electric and water bills, and you living allowance. The rest of the money must go to your debt-paying-goal.

Another thing you must remember is that, declaring bankruptcy may not be a good option for you. The future consequences of that declaration might be worse than you think.

Remember that for debt to pile up takes time, and repaying them will take more time as well. After you have paid your debt, or even if you’re still on the process of repaying your debt, you must now learn how to budget your personal disposable income.

Remember living within your means. Spending must be minimized so that you won’t find yourself in too much debt again.

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