5 Steps to Reducing Debt
Do you feel like your debt is holding you back in life? If you’re feeling overwhelmed by your finances, we’ve got a step by step process for you to start taking control of your debt today!
Step 1: Evaluate your Debt – All of It
The first thing you must do to move forward with a plan to reduce your debt is sit down and take a hard look at your finances and just how much debt you owe. Once you’ve got the details down, evaluate where your debts lie and understand that not all debt is alike. Some of your debt may be causing more of a financial strain than others, like credit cards with high-interest rates, so taking time to dig into your debt and prioritize what needs to be paid off first will help you to gain some control of your financial strains and begin your journey to debt-free living.
Step 2: Understand your Bills and your Budget
Have you done the math? If not, step #2 of your debt reduction plan involves evaluating your income each month along with how much you are spending. This is a great time as well to truly gauge your expenses and figure out where you are being frivolous. If your income does not outweigh your expenses, it may be time to consider asking for a raise at work, taking on a second job, or, adjusting your lifestyle to live below your means in order to focus on paying off your debt.
Step 3: Set Timely and Attainable Goals
While we’d all love to have our debts paid off immediately, setting unattainable goals to have everything paid off as quickly as possible can leave you feeling drained and like living debt-free is next to impossible. After you’ve taken time to evaluate your debts, your income, and your spending, design a plan that works for you to help get you out of debt.
Step 4: Make a Plan to Achieve Them
Now that you have a plan, how will you put it into place? Whether it be that you begin setting up auto payments or you choose to completely alter your lifestyle to cut out unnecessary spending, putting daily practices in place to help you achieve your financial goals is crucial. If this step feels like the hardest of all, remember that this is only temporary and is necessary to help bring you to financial freedom.
Step 5: Seek Advice from a Mentor or Financial Professional
If you’re still struggling with debt and financial woes and it seems like any plan you put in place isn’t working out, don’t be afraid to speak to a personal mentor or financial professional. Seeking advice from an expert and having a peer or mentor periodically check in with you on where you’re at with your goals can be an effective route to help you become debt-free.
If you’d like to speak to one of our financial professionals regarding your situation, click here to contact your local Inlanta officer today!