The one thing that can literally drive a person to his knees and would force him to do the unthinkable is incurring flooding debts. Now in the life of a person, one way or another he will have to incur some debts due to loans which will turn sour if not handled properly. So for those who planning to take up loans or have existing loans, here are some strategies in debt-elimination.
Now before anything else, it is best to point up that before one takes up a loan or incurs a debt, he has to have a proper mindset. First of all, he has to have the mindset of having a goal in mind like wanting to own a house, maintaining it, or wanting to own a car. Second, he must always have a safety net just in case.
First off, one has to segregate all of his debts into order of priority. The first on the list should be the ones that would incur interest since the interest would just become bigger and bigger as time passes. Examples of these kinds of loans would be the car loans and other bank loans.
After that, one has to further segregate these interest bearing debts into which one must be paid first. Normally, the closest one to the due date should be concentrated on first followed by the next and then the next. However, while one is concentrating on one, he may already plan the payment for the other one.
Now do take note that certain debts such as the monthly ones like the phone bills and other utility bills will get a least important ranking in the priority list. The reason that being they have no interest that could be incurred and that they can be delayed for a time period too. However, these utilities will of course be cut off.
Now when all the debts have been properly categorized, one now has to make sure that he reviews the terms of payment. Now this is very important because based on those terms, he can properly allocate his salary to pay which debt. Also with this, if the creditor may want to collect more than what the terms say, the debtor may use that against him.
Now if one is drowned in too much debt and has absolutely no money to pay it off, then the last resort would be to declare bankruptcy. Now before one would do this, it is best that he consult his lawyer first on how to go about with the process. However, do remember that this is a risky move and should only be done as a last resort because of the consequences that come after.
Debts will be incurred no matter what happens because people will definitely need some extra help financially. So in order to be more educated on how to handle debt, a lot of financial institutions actually teach people how. Moncton, NB is a city wherein almost all financial centers would give seminars on this.
Now before anything else, it is best to point up that before one takes up a loan or incurs a debt, he has to have a proper mindset. First of all, he has to have the mindset of having a goal in mind like wanting to own a house, maintaining it, or wanting to own a car. Second, he must always have a safety net just in case.
First off, one has to segregate all of his debts into order of priority. The first on the list should be the ones that would incur interest since the interest would just become bigger and bigger as time passes. Examples of these kinds of loans would be the car loans and other bank loans.
After that, one has to further segregate these interest bearing debts into which one must be paid first. Normally, the closest one to the due date should be concentrated on first followed by the next and then the next. However, while one is concentrating on one, he may already plan the payment for the other one.
Now do take note that certain debts such as the monthly ones like the phone bills and other utility bills will get a least important ranking in the priority list. The reason that being they have no interest that could be incurred and that they can be delayed for a time period too. However, these utilities will of course be cut off.
Now when all the debts have been properly categorized, one now has to make sure that he reviews the terms of payment. Now this is very important because based on those terms, he can properly allocate his salary to pay which debt. Also with this, if the creditor may want to collect more than what the terms say, the debtor may use that against him.
Now if one is drowned in too much debt and has absolutely no money to pay it off, then the last resort would be to declare bankruptcy. Now before one would do this, it is best that he consult his lawyer first on how to go about with the process. However, do remember that this is a risky move and should only be done as a last resort because of the consequences that come after.
Debts will be incurred no matter what happens because people will definitely need some extra help financially. So in order to be more educated on how to handle debt, a lot of financial institutions actually teach people how. Moncton, NB is a city wherein almost all financial centers would give seminars on this.
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