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Debt Free
Sometimes, debt looms over us like a specter. It hides in the shadows, and at any moment, it will overwhelm us. Debt is like a jailor that imprisons us to jobs that we don’t like and forces us to live in a small apartments near the airport. Many people are able to escape from the debt quagmire, but there are those who are never free from their debts.
Finding freedom from debt can be difficult, and it is so amazingly easy to rack up debt. A tiny plastic credit card can quickly become an enormous financial burden. Costly payday loans, interest rates, mortgages, late fees and student loans all add their weight to the load.
A large percentage of Americans are not debt free. They churn out debt and put off paying it. That behavior isn’t sustainable for very long. Imagine a waiter carrying some plates. Each time he goes deeper in debt, he has to carry more plates. Eventually, the waiter and the plates will all go crashing down.
There are many reasons to be debt free, but the best is probably your health. Being in debt is often listed among the most stressful things in life. In fact, almost every stressful event, death, divorce, moving, buying a home, illness, being laid off, having children has a major financial factor to it. Debt seems to be the insult that is added to the injury.
There are several steps that should be taken in order to liberate yourself from debt.
Live Within Your Means: This seems like the simplest solution to achieve independence from your debtors, but it is not always the easiest. And “the best laid plans of mice and men often go awry.” One day you might find yourself with all your credit cards paid off, living nicely within your means. Suddenly, the transmission in your car explodes and you’re back to square one. One the bright side, however, it would be twenty times worse if your car breaks down when you’re drowning in debt.
Budget: Writing a budget may seem like a boring, possibly daunting task. It is, however, an important one. When you itemize your spending you can see how and what you spend your money on. Many of us like to eat in restaurants. Who doesn’t? How much do you spend on restaurant food? Probably a lot more than you think. A budget is a good way to quantify this spending and reduce it.
Pay It Back: Once you’ve established a budget. It is important to start paying off your debts. Often times, you can call the companies that you are indebted to. They are usually understanding, because they want their money. It is cheaper for them to be understanding than to hire a collection agency. They can offer a flexible payment plan or possibly reduce your interest rates if you can prove to them that you are serious about paying back your loans.
Other Methods: There are companies out there that help people consolidate their debt, but these companies are often costly themselves. They should be used as a second-to-last resort. And, of course, there is bankruptcy which is the last resort. It should not be taken lightly as it can mar your credit score for years to come.
Hopefully, most people who read this article are debt free and will never have to deal with pitfalls of that nature. Those who do deal with debt, however, must find a way to escape from debt before debt deals with them.
Topics: Debt Consolidation |
