If you feel like you are just drowning in debt, you are not alone. Debt can feel like a very personal crisis but the truth is, most of America is going through it with you. Too many people have found themselves in a position where they feel like they are simply unable to do anything to pay off the amount of money that they owe. If you are in this position then here are few tips that might give you some hope of restoring your life to normal once again.
Sit with a financial adviser.
If you can find someone that you trust, you might benefit from sitting down with a professional financial adviser and figuring out what your best options are. They might suggest bankruptcy or they might be able to work something out with you. One of the best things that a financial adviser does is put you in the right frame of mind. When you are so under water and you feel like you can’t breathe, it’s easy to panic and feel like your situation is far worse than it is. Talking with a financial adviser can straighten out your mind and show you that there is a light at the end of the tunnel, even if it seems like it is a long ways away.
Figure out a pay off plan.
Write down every single penny that you owe. Then write down how much you make monthly. Figure up a budget for yourself pertaining to your income and expenses currently. Once you’ve done that you’ll see how much you make, what your monthly bills are and what you have left over to pay off what you owe. If your debt is already in collections, chances are, they might be willing to negotiate a payment. For example, if you owe $1000 to a particular company and a certain amount of time has already passed, you may be able to call and let them know you can pay $600 or $700 right now if they will forgive the remainder of the debt. Debt is sold from collection agency to collection agency and loses value over time. Because of this, the current holder has room to accept less and still make a profit.
File bankruptcy.
Filing for bankruptcy is not something that you want to decide flippantly. Only make this decision after sitting with a financial adviser or a bankruptcy attorney. This should be your absolute last resort. If it is going to be completely impossible for you to pay off any of your debt, this might be a way to clear the slate. However, it will remain on your credit and affect you for many years to come so think carefully before making such a rash decision. There are different kinds of bankruptcy so make sure you also look in to each type. You may be able to file a type of bankruptcy that will not strip you of everything that you own.
Sell an investment.
If you have an investment property or various cars or have invested in stock, it might be time to sell those off. You may feel opposed to doing that at first because it likely took you a long time to be able to work your way up to being able to do that. However, this is going to be the quickest way that you will be able to get out of debt. If you filed for bankruptcy, it would likely be taken from you anyway.
Follow a professional money saving plan.
Dave Ramsey and others have come up with what they say is tried and true methods in order to get people out of debt and onto a money saving track. It’s going to require lifestyle changes. Barring unforeseen circumstances like medical bills, etc; many people get in to debt because they have made financially foolish decisions over the years. In order to get out of debt and stop living paycheck to paycheck you’ll need the assistance of a self help plan or professional money saving plan in order to break bad habits and learn how to implement good ones.
Don’t despair if you are in debt. There are things you can do to help yourself and it is certainly not the end of the world.