Living with debt isn’t easy. Now, more than ever, increasing numbers of us are experiencing debt as a result of lost work or reduced income as a consequence of the coronavirus pandemic. Many of us haven’t been able to work for months. Many of us are having to accept reduced salaries to keep our work.
Whether this is the first time you’ve experienced being in debt, or you’ve been through the process before, it’s always a good idea to know the basics of debt management. These tips and tricks will help you to get by!
Summarise Your Debt
First, you need to summarise your debt. Some people simply owe their debt on one major loan or one high limit credit card. But the vast majority of us tend to have different debts to different companies.
If this is the case for you, you need to make sure that you know exactly what you owe to who. Go through all of your letters and accounts and make a comprehensive list of all the debts you owe. This will give you a good starting point.
Eliminate Unwarranted Debt
When you go through your debts, you may realise that there are debts in your name that you didn’t accrue, that have expired, that is still showing on your record even though you’ve paid them off, or various other issues. It’s important that you contact the relevant lenders or companies about these to ensure that any unwarranted debts are cleared from your name and account.
Look Into the Terms and Conditions of Your Debt
Whenever you take out a loan, finance agreement or credit agreement, there are going to be terms and conditions attached. It’s absolutely essential that you look through your credit agreements to ensure that you know the ins and outs and know what you can and can’t do to relieve these debts.
Different approaches will be best depending on the terms and conditions. For example, VA debt management will use different methods to overcome debt than difficulties with keeping up payments on a car finance plan.
If you’re struggling to keep up payments on your debts, it’s always best to contact the lenders directly.
You can explain your circumstances to them and they may be lenient and alter payment dates, cut added interest costs or give you a payment holiday. They may even allow you to come up with a payment plan that allows you to pay outstanding debts for things like bills in smaller contributions.
This, of course, is much more preferable to simply ignoring your debts, letting fees and fines accrue and potentially facing court action.
Of course, being in debt can be an extremely stressful experience. But hopefully, some of the above advice and information will help you to manage your debt effectively, crafting a light at the end of the tunnel for you!