6 simple ways to get you out of the dreaded debt trap
DEBT: the dreaded four-letter word that has become a plague for many people. It is the thing that eats away at your funds, and puts a burden on your financial welfare. In a previous blog, we defined debt as “the state of owing something” and in most cases that “something” is money. In this blog we are giving you some handy tips to follow if you are currently drowning in the “debt trap” and want to get out.
1. Set your financial goal
What is your goal? A 50% reduction on your debt? Become debt free within the next year? Whatever it is, we don’t care where you put it; stick it on your fridge, put it on the mirror in your bathroom but put it somewhere visible. The more often you see your goal, the more likely you are to achieve it.
2. Slow down on your spending
The more you spend, the further down the debt hole you are going to fall. Avoid making any purchases on your credit card; especially on unnecessary purchases. If you don’t have the money to buy something rather wait until you do, instead of using credit.
3. Make a list
If you want to tackle your debt problem head on, you need to know exactly what you are dealing with. Create a spreadsheet that displays all your debts, their minimum monthly payments, interest rates and total amount owed. Now that you have a clear picture of your debts, you can begin to make a plan to conquer them.
While you are in the mode of creating lists and spreadsheets, why not create a simple budget.
4. Make some extra moola
Extra money goes a long way, especially when you are in debt. Why not try and find some part time or freelance work? Or you can even sell some unnecessary “stuff” lying around the house on sites such as Gumtree or OLX.
5. Cut out unnecessary costs
These costs can include anything, like buying unnecessary items (online and in store) and entertainment costs like going to movies or eating out. These are simple and easy expenses that you can cut down on.
6. Be patient
This may be our most important tip. Getting out of debt is not going to happen overnight; it can be a lengthy process so just be prepared. Start planning for the future and creating a new lifestyle. It is the only way that you will benefit down the line.