Debt Management Solutions
It is not hard to find yourself in deep debt. You may take out a car loan, borrow money for educational expenses, buy a house, or go overboard with your credit cards. Whatever the reason, the amount you are left owing can be intimidating. The good news is that a debt management plan can help you create a budget and pay those overwhelming balances down. Here are four tips for debt management that everyone needs to know:
Limit Your Spending by Using a Budget Calculator
If you already owe a significant amount of money, you need to limit the amount of debt you add on. Create a monthly spending plan by using a budget calculator. Try not to just live according to your means, but below them. This means cutting expenses by eating out less, getting rid of cable television, and avoiding travel. You may even want to consider downsizing your home. This may not be easy, but it does not mean that you cannot have fun. Just get creative and find ways to have fun while spending less.
Increase Your Earnings
If your salary is not up to par with the cost of living where you live, or you do not have enough money when the end of the month rolls around to pay your debts, it is time to increase your income. Talk to your boss about getting a raise, look for a new job with a better salary, or supplement your current income with part-time or freelance work. Keep in mind that even an extra $500 a month can put a big dent in your debt. If you are able to cut expenses and increase your income, you could even double the amount you can pay toward your debt.
Negotiate Your Debt
If you are having trouble making your minimum payments each month, you may give debt negotiation a try. If you have only one debt with one lender it will be clear where to start your negotiations, but if you have multiple debts with several lenders, where do you start? First look and see if you can move to a smaller home or a less expensive neighborhood. Maybe you have two vehicles and could downsize to one? These choices can be tough but may be necessary.
Look at Interest Rates:
What if you cannot downsize your home or get rid of a vehicle? Now it is time to look at the interest rates on the debts you do have. If you have a student loan with a low-interest rate and a credit card with a high interest rate, prioritize the debt with the highest interest rate first. Try to make more than the monthly minimum payment but continue to make minimum payments on the other debts, too.
Contact an Experienced Attorney
If you are still not certain how you can pay off your debts and need professional assistance, reach out to the attorneys at Cornwell Law Firm. We will review your finances with you and help you determine what your best options may be. Contact us today to schedule a consultation.