It doesn’t matter how you got here, but ‘here’ isn’t a nice place to be. A lot of people find that unfortunate moment when debt has grown too big to deal with as you are. It might be that you’ve lost a job or you’ve had some hard-hitting expenses. Some people simply lose track of their finances. But even when you don’t have a huge net worth and a lot of income to play with, there are ways you can get yourself in a better position.
The sooner you call up your creditors, the better. We know you won’t like the idea of talking to them. But the truth is that if you’re suffering serious financial hardship, many of them will be willing to look over the current deal and make it more manageable. It’s important to do this soon, however. Creditors are usually a lot easier to deal with than the collections companies they might get involved if they hear nothing from you for months.
Prioritize and strategize
Whatever money you have coming in has to be planned to the penny. Just as you budget when tackling big financial commitments, you have to do the same when tackling big financial problems. Set aside the money you need for rent, utilities, the car, and groceries. Then use the majority of the rest to tackle debt. But don’t spread it evenly. Tackle the debt that’s the most urgent or that with the largest interest rate. If you have a small debt that can be tackled in a matter of weeks or a month, do it to feel the momentum. But don’t get caught going for the smaller ones first while the big interest debts keep piling and piling.
Shuffle the debt
If you’re in debt, it’s likely your credit score is starting to go down. However, even if it’s at the point where a bank wouldn’t look at you too favorably, there are options. Moving debt by exploring options like no credit check personal loans might increase the amount you have to pay. However, if that means changing a two-month deadline to a six-month deadline, the value of that option is easy to see. Just make sure you check the interest and ensure it fits you current budgeting abilities.
Ask for help
A lot of people don’t like this step, but it’s one that can really save a life. If you can’t manage your rent alongside your debt payments, then it’s worth looking into organizations that might be able to lend a hand. Talk to your landlord about your difficulties first and even consider finding a roommate. But if that fails, organizations like the Salvation Army and Modest Needs can help give you the boost you need to get back on your feet.
Getting out of financial trouble when you have little to offer can knock your confidence, but things will get better when you pull yourself back out. Take the time to rebuild, starting with measures like an emergency fund that can help you avoid this kind of stress next time.