Financial Related
Enjoying Life Free From Debt
Our needs increase along with the changing era, however our income doesn’t increase. And this is the main reason why most people got trapped in debt. It is fine if debt is being used for something productive - for instance to start a small business. However, most people are taking debt for something consumptive. And in the end, life turns into a mess and got strangled by debt.
Living a good life without even have to be worry about any debt is what everybody wants. But what should we do to get us free from debt and enjoy life more? Below are advices compiled from some famous financial advisors to help you free yourself from debt.
- Prioritize to pay the high- interest debt, for example credit card because the interest given to the credit card repayment is higher than bank interest or deposit interest.
- Pay first the monthly household needs, for example electricity bill, school fee and so on.
- Check and recheck everything you bought on installment. For example car, ask yourself is it really necessary? Or if the monthly repayment is affordable.
- Calculate all of your debt including the possible interest rate. Use the number as a benchmark to allocate the money to repay the debt. By doing this, we will know the amount of debt so we won’t get tempted to buy anything on installment again.
- Track back how much the total debt you have to pay every month. The amount shouldn’t be more than 30% from your monthly income.
- Negotiate your debt. If its not possible to be paid yet, try to arrange the schedule for repayment or the interest.