Is getting out of debt among your promises for 2015? Then check out the tips from Good Lenders Credit so you can reach your goal by Christmas next year. With discipline and determination, it is possible to resolve your financial situation once and for all.
Map your spending
Make a list of all your expenses to get the real dimension of your monthly cost. To do this, you have two options: manually fill out a monthly expense spreadsheet or rely on an automatic financial control tool such as Good Lenders Credit, which automatically pulls and categories all your bank transactions in less than two minutes.
Create goals for your expenses
Based on the 50-15-35 rule, create goals for all your expenses, dividing them into three categories: 50% of income for essential expenses (housing, food, transportation, health and education), 15% for financial priorities (if you have debts, pay them off, if not, save) and 35% for expenses related to lifestyle (bars and restaurants, gym, beauty salon, shopping, travel and clubs).
Find out the total amount of your debt
Get in touch with each of your creditors and ask for the amount to settle your debt in sight. This amount must be discounted from interest and any fines. If you have access to a cheaper line of credit (such as payroll loans or a secured loan for real estate or automobiles), it is worth considering the possibility of replacing all small debts with one with lower interest rates.
Renegotiate with creditors:
If you are unable to replace all your debts with a single one, it is worth contacting the creditors and making a counter offer for the payment of the debt. Propose lower interest rates and a longer payment period, so that the installments fit your budget and you don’t get into debt again.
Be persistent! If the creditor does not accept your proposal the first time, keep in touch frequently with the renegotiation center and save the amount you would pay in installments to make a new proposal up front, giving part of the payment as an down payment.
Create an emergency reserve
Once you put your debts in order, your next financial objective should be to create an emergency fund of three to six salaries to protect yourself from life’s unforeseen circumstances. This money must be kept in savings so that you do not be held hostage to the overdraft each time you go through a difficult time.