Pay Off Your Debt and Start Saving:
Debt, we cannot live without it, house, car, clothing accounts the newest tech, we must just have all these things in our lives and to acquire it we must make debt. Unfortunately once you in the debt trap, it is hard to break free from it. So, how do you get debt under control so that you can start saving?
Steps To Get Out Of Debt:
- Stop Making Debt – To eventually pay off your debt you must stop making debt this is the first step. Cancel or block store cards, cancel credit cards only keep one card active for emergencies. Avoid small loans, subscriptions or contracts of any kind, go prepaid for your airtime etc. and go without the latest telephone. The only acceptable form of debt is a home loan, vehicle loan, student loan or business loan.
- Cash is King – Changing your spending habits play an important part in paying off your debt. Credit is easily accessible and the temptation to just buy what we want on credit is like second nature we do not think twice. To stop this habit you need to change the way you spend your and start to only buy items you want cash if you cannot afford it cash then save for it. Only make use of credit in emergencies that occur due to unforeseen circumstances whereby an unexpected expense needs to be taken care of and you have no other option.
- Create a Plan To Pay Off Debt – Work on a plan to settle your debt. Start with an account that has the lease amount still owing to pay off and try to pay more than the monthly installment. Then work your way to the other accounts, use the money from the accounts you already settled to pay off the accounts quicker. If you find that you already into deep with your debt then consider debt counseling or try consolidating your debt and just pay off one installment.
- Saving Plans – After your debt is settled you will have more income at your disposal. Open a saving plan for each item or project you want to save money for. Also, have a saving account for emergencies to accommodate for those unforeseen expenses.
- Investments – If you read this and have you no investments yet, then start today. Investments are for long term saving. The sooner you start investing in a retirement fund, education fund or endowment plan the more money you will have invested for your future.
- Insurance – Having insurance can be a burden on your budget. But insurance safe cards you against any financial strain in case of an accident, death or any other calamity that might cost you extra cash. Make sure that your insurance will cover your needs and that you are not underinsured.