Time is your most precious commodity once it's gone, you can never get it back. Getting yourself into debts means working long hours just to hand your money over to someone else. So all your time is going by and you most likely will have nothing to show for it. It only took me about six months to develop one of the worst habits of my life, frivolously spending money I did not have. After all the credit card debts came in the mail, it all became too real. One day I had a nice bank account balance well over $5,000, the next day it was not even enough to pay my debts. Not controlling your money and accumulating bad debts is a financial suicide mission. When I was in debts, I realize just how much of my time I had to hand over. Debts take from you in all aspects, it takes your time, happiness, and crush your dignity if you allow. Learning to balance your income and expenses is the true way to master your time.
If you are currently working for money, try living below your means to ensure you have a little left over for rainy days.
Start by Understanding How you Got into Debt. Never look back on your life with mistakes, look at every event as an opportunity to learn. Understand how and why you accumulated your debts to avoid a future repeat of the same error. Addressing the underlying issues enable you not to go back to your old spending habits. The problem is not your debts; it's the bad habits you have that acquired debts.
Decide on the best approach for your current dilemma
Stop, don't panic, assess the situation before you come up with any solution. Crisis can seem much worse than they are if you panic so take a deep breath to understand what is going on in your life. The best solutions come to us when we use our brain to assess instead of making assumptions about the situation.
“I join a debt management plan program to help me cut back on interest and set a monthly payment plan I could stick to.”
That plan worked for me because it allowed me to lock in my monthly payments and avoid high-interest rates. If you decide to join a debt management plan first think of your fixed expenses, next add your payment amount for your plan, and now you know how much cash you have left over. Gather all your debts and your income for the month and get quotes from debt management companies. Once you start the program, they lock in rates on your interest or eliminated them altogether, lowering your debts considerably.
All you have to do is take care of your money; it will take care of you. Learn to cut all unnecessary expenses, keep track of your money no matter how little or big your account balance. Create balance sheets to track all assets and liabilities. All you need are tools like a bank balance sheet, an income statement or a simple notebook to do the math. The day you start tracking your money will be the day you ask yourself 'why did I wait so long to do this'. Tracking your finances is what will make or break you financially, so it's better to start sooner rather than later. It is not just about how much you are making, but how much are you keeping after expenses. Earning money is great, keeping most of that money is even better. Conquering your debts require more than paying the bills every month, you need to overcome your debts permanently.
Create and follow logical steps to get out of debts successfully.
Learning to control your money is learning to control your life. You need to acquire skills, practice monitor your spending habits to create a debt-free future. As long as you are responsible, you can still have a credit card, own a home, and take vacations. Take the time to understand interest and charges on your cards. When paying back your credit cards, if possible, pay more than the minimum payments or pay the balance off.
Creating these good spending habits, tracking your expenses and savings along with some investments will help you become financially stable. You will earn an income, save money and invest in the right places to become financially free.