3 Steps You Can Take to Get Your Debt Under Control
Managing debt can be a challenge, but we’re here to help you take control once again. Our 3-step approach makes debt management easy and helps you regain control of and confidence in your personal finances.
Let us show you how!
Step 1 – Assess and Acknowledge Finances
Managing your debt starts with understanding the true nature of your finances. As anxious as it might make you feel, understanding where your challenges are and staying honest with yourself about your debt situation is the first step in making meaningful change.
Look at your income, expenses, assets, and liabilities. Ask yourself these questions:
- Do you rely heavily on another income earner to make your personal bill payments?
- Are you only making minimum payments to credit?
- Is your credit very high-interest, such as payday loans and store cards?
- Is it difficult to make housing and utility payments on time?
- Do you have money left over for savings once your bills are paid?
- Are your credit cards near, at, or over their limit, and have they been for some time?
For example: do you only make the minimum monthly payment on your bills? Many people think that making the minimum payment means they’re in decent financial shape. But most minimum payments on credit cards and other bills are so low, paying them barely covers interest.
This means that you wind up paying far more
than you would otherwise have to!
Facing debt can be scary but acknowledging the problem is your first step towards fixing it.
Step Two – Decide On a Plan and Act
After assessing and acknowledging your debt challenges, it’s time to get some financial counselling. You’ve got to choose to get firm advice that’ll help you make the right decisions for your situation and develop a plan to get your debt and finances back under control. Look for a financial professional who:
- Is accredited or regulated by a government entity; this ensures you have recourse in the event a situation arises.
- Does not request a fee upfront.
- Presents no conflicts of interest – is their service is the only solution to your problem?
- Has the authority or power to implement the recommended courses of action.
- Has a strong brand or name that you recognize, and an online presence you can trust (recommendations, blogs, thought leadership, etc.).
Once you’ve found a financial professional to work with, you may need to make some tough decisions. Debt management is more than making minimum payments, and includes cutting down the total debt amount and developing a budget and plan to find room to do so.
Buyer Beware! There are many non-regulated or unaccredited firms and professionals who claim to offer debt services. Some present conflicts of interest, but more often than not, these firms and professionals can lead to greater financial problems in the future.
Step Three – Execute Plan and Rebuild
You’ve taken a long, hard look at your finances. With the help of a financial expert, you’ve come up with a plan to reboot your finances. Now it’s time to execute that plan!
Executing your plan to deal with debt means it’s time to:
- Create and implement a personalized budget.
- Become less reliant on credit.
- Explore ways to repair damaged credit.
- Make a commitment to yourself to never see your debt get out of control again!