How to be Free from Debt in 2016
Part One San Diego debt relief
If you began 2016 held down by debt, you might feel that your New Year is already lost. Life can sometimes become overwhelming and leave us hopeless, especially when battling the pressures of financial challenges. Perhaps the worst part is the constant barrage of collection phone calls and letters from the relentless pursuit of creditors seeking unrealistic payments. If this describes your situation, please read on to find hope and real solutions.
We can all accumulate debts for different reasons. More times than not, debt can result from a sudden job loss, medical emergency, or unforeseen economic hardship. Additional ways that debt can sneak up on you is through mismanagement of funds on a daily or monthly basis, as well as overspending through the Christmas and the Holiday season. These financial decisions have a dramatic and compounding affect on family finances and the hopelessness of debt, but thankfully there is a remedy available.
Additionally, the financial strain of college is a looming burden of financial constraint. It can become very easy to focus the on the everyday tasks of raising a child without planning for their future college needs. If a family was unable to prepare for the financial needs of college, then the student will often begin their adult life by accumulating debt. This premature debt load, accompanied with expense for a car, rent, and living expenses on student wages creates a debt load that is nearly impossible to repay. Many people are facing this dilemma today, but thankfully solutions exist.
Dealing with Debt
Each of these scenarios are scary to imagine and even worse to experience. At times, circumstances can be extremely life altering, affecting relationships, decisions, and one’s over all well being. When it comes to debt, you have two choices: allow it to overwhelm and suppress you or seek debt relief help to get your finances and life back on track.
Debt relief help is not always an instant fix, as it takes time and diligence to see it through. To succeed in the best debt relief programs available, you will have to practice proper spending habits and execute a strategy laid out for you by professional who understands the legal landscape often exploited by your creditors.
How do you get free from debt?
The first step is looking at your net income. To get a clear picture of your financial health, deduct your monthly expenses from your net (or take home) monthly income. These expenses include things like: rent/mortgage, utilities, food, transportation, childcare, and insurance. After subtracting all of your monthly expenses, you will realize the amount you have left at the end of each month. Making a budget is simple, but unfortunately most people fail to do it. Don’t be like them; instead, take this important step to change your situation.
Next, gather all of your financial documents for the debts you owe on items like personal loans, auto loans, credit card bills, student loans, etc. After all your documents are gathered you can make a list of all your debt balances including payment dates and interest rates. Hopefully, the amount of these payments will fall below the total amount of money remaining from your net income after paying expenses. Prioritize your debt by working from the highest amount owed (or interest rate) to the lowest amounts owed. In other words, if someone handed you money today, whom would you pay first tomorrow? Having a plan like this will give you great empowerment, even though you may not yet understand the “how” your debt relief plan will work.
If it looks like you will not have enough money to cover all the monthly payments, review your monthly expenses to see if any can be reduced to help cover the amount needed for debt payments. Some typical expenses that may be eliminated or reduced are unused gym memberships, mobile phone plans, home cable and Internet, and reducing the amount of times you dine out at restaurants. The amount that can be saved with these small adjustments may surprise you!
Another method to help with reducing your monthly payments and overall debt is contacting each lender to request a lower interest rate or cancellation any annual fees. While it may sound impossible or improbable, it happens more often than you might think. The simple action of picking up your phone and explaining the hardship situation you face to your creditors may buy you some help. Give it a try, the worst they can say is “no.” If you have managed to maintain a good credit standing at the time of the conversation, it may help you in the negotiation process as well.
Credit Card Debt
Debt Relief Tips
About Brownstone Law Group – San Diego
This article has been reviewed and approved by Thomas A. Moore, managing attorney Brownstone Law Group, PC. California Bar # 148698. This article is for informational purposes only, does not provide legal or tax advice of any kind or form any type of attorney/client relationship. This article was published on February 04, 2016.