Question: It’s 2016. Our culture and society encourage us to push the limits physically, emotionally and financially. The demands of a typical lifestyle can challenge even the best incomes. But what do you do when the pace gets too hectic and the money gets too tight? What do you do when the FMO (fear of missing out) lures you over the edge?
Answer: You need a plan. You need discipline. You need sound advice. Don’t be afraid to ask for help from a Licensed Insolvency Trustee. Rely on their experience and get the advice you need so that you can get back on track. Here are some considerations:
1: contact the Credit Bureau (Equifax or TransUnion) and obtain your free credit report. Read the report, take note of all account details and correct any errors.
2: make a list of your current debt load and the interest rate for each account.
3: Prioritize your expenses. Essentials are given first priority – food, rent, transportation, clothing and any required medical expenses. Then you need to account for income taxes, the mortgage as well as vehicle and other loans that have fixed payments terms. The third category is for all other debt – credit cards, retail store debts and miscellaneous debt). The fourth and final category are variable expenses such as hobbies, maintenance, savings, vacation, leisure, etc.
4: Identify expenditures that can be reduced or cut and apply to debt payments. This requires mapping out where your money is going and ensure you are not spending more than you are making.
6: Create a monthly spending plan (budget). Detailing all your monthly expenditures beforehand will allow you to manage your money and make cuts wherever you can. This is something that needs to be done at least once every 6 months to stay on track.
5: Pay off credit cards. There are two credit card payoff strategies that are the most common. The first is to pay off the card with the highest interest rate as quickly as possible, while making the minimum payments on your other cards. The second strategy is to pay off the card with the lowest balance first and stop using it. This is not as cost-effective, but it is motivating and an easy way to reduce the number of cards you use.
Finding financial balance can be difficult and often intimidating. Life goes on regardless so taking stock and adjusting your aim from time to time makes sense. It will feel like a breath of fresh air.
If you need help with your plan or are burdened with debt stress, asking for sound advice is a sign of strength and the smart thing to do. Asking sooner rather than later is always better.
Call or Book online today for your free, no obligation consultation. You’ll be glad you did.
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