in arrears: How to Tame Debts

Really, I should learn more about this. The instant I peeped in my credit card statement of account, I got into thinking how in the world I came to have a debt amounting to that. I am having hard time thinking about the purchases I made since I can’t really remember valuable or expensive things I bought using it. For less than a year, I have almost reached my credit limit. I really really have to put my card into the fridge and not use it until I have finished paying it off. Although it’s a consolation that I am still in a good credit standing by paying my monthly minimum due promptly, I am so eager to pay it off right away. I just don’t like the thought of having a debt like that although it is a contradiction to the amount written over my credit statement. I am not really into borrowing money especially personal loans. But who doesn’t have debts anyways, right?

I found great sites that have detailed tips on how to avoid and manage debts. For obvious reason, I think the real solution to free your self from being caught in the middle of pouring debts is by avoiding it in the first place.

Here’s a great article I have copied verbatim in Ezine Articles as written by Usha Pradhan.

A debt free life style denotes a financial protection and an autonomous financial possession without any additional financial trouble. It means a life without paying an interest that always has to be managed by compromising with the needs and dreams of our day-to-day life. We, however, do not always succeed in managing our finances in the manner we want them to be. As a result, we often have to bear the burden of a debt.

Here are a few basic steps that we need to make a rule of thumb. Once that is done, we can easily keep all sorts of debts at bay. Even if we are presently bearing any debt, following these steps will see us to the safer shore.

1. There should be a proper budget that never exceeds the income. The budget should notice the basic need of the family/person carefully. The concentration should not be on the commodities like new electrical gadgets, fancy cosmetics, toys, if the pocket does not permit it.

2. Usage of credit cards should be restricted. This is something that leads the family/person towards unwanted debt. If the bank offers a very normal interest rate, try to avoid using a credit card even then.

3. If there are already debts on the family/person, that needs to be solved out first. Anything, but the repayment should be the first priority. This should be the primary concern in your budget. According to the amount of the debt money, other expenditures should be listed up. If the annual percentage rate of the bank is high, then try to save even a single penny, if you have any as extra at all. Do not run after the dreams before the debt settlement.

4. If you have Debt from many sources, then you need a debt consolidation. Count the exact amount that you have to return, and then make a budget which can show you the exact time to be debt-free. Spend some days on debt diet. Distinguish between your needs and wants. If you want, you can go for credit counseling.

5. Make sure that you pay the interest every month in time. If you cannot remember dates, highlight the dates on calendar.

6. If you are unable to make an economic budget that will help you to be debt-free, opt for a debt repayment accelerator plan. They will fix a budget according to your family income and the priority will be on refunding the money and the payment of interests. Some debt-free software systems are available in the market that can guide you.

7. After paying back the all money, you again should be careful about the upcoming debt. Plan the monthly budget with your partner so that you can save some from your earning and make sure that you are not buying unnecessary things with credits.

8. However, after all struggles, you may need money for an emergency. So try to save as much as you can with a proper plan. Furthermore, if you need much than your savings, try to get money from a reliable source. Always look for the most comfortable credit plans, look after the rate of interest carefully.

So... Enjoy a financially secured debt-free life.