Too much debt plagues a myriad of people each and every year. Credit cards are often one of the slipperiest slopes that lead to people quickly getting in over their heads. Often times, a single purchase or two can easily transform into a multitude of overdue payment notices and compounding interest fees. Afterwards, getting out of the red can become a never-ending challenge.
If you are saddled with abundant debt, you are prone to developing bad habits that often deter you from efficiently paying back the money you owe. Below are two common habits of a person struggling with debt repayments, along with our recommendations on how to best combat them.
Face your debt head on
If you find yourself leaving bills unopened when they arrive in the mail, spending money without regard to your monthly budget, or constantly letting the phone go to the answering machine for fear of collectors, you may be in denial of your debt. Not taking action is a detrimental approach to your situation, and will cause your debt to grow exponentially.
In order to best remove yourself from this habit, you should start by paying the minimum monthly charges on all of your debts. Then, beginning with the ones with the highest interest rates, use any leftover funds to pay off each one. Continue this process until every one of your debts reaches zero.
Save money while repaying
Debt holders often fail to save money while concurrently paying off their debt. This can paint yourself into a corner, in the event that an unforeseen circumstance arises and your emergency fund is empty. While simultaneously saving money and paying off debt can be difficult to do, it is entirely possible.
It is recommended that an emergency fund be created, and a reasonable goal be set. A specific amount of money should be set aside from each paycheck to be placed into this fund. Until your goal is reached, you should cut down on all unnecessary daily expenses. It is also a good idea to put any additional money you make directly into your emergency fund.
If you are battling credit card debt, Kelley & Fulton wants you to know that you are not alone. As a group of experienced bankruptcy lawyers in West Palm Beach, our firm would love to help place you on a path to a more stable financial future. Kelley & Fulton understands what you are going through, and invites you to schedule an initial consultation to let us get acquainted with your situation today.