Written by Michael Foote, Insurance and Finance ExpertMichael Foote is the founder of Quote Goat and has over 13 years experience working in the finance, insurance and currency sectors. Since launching Quote Goat he has appeared on TV as well as many of the largest online publications including Forbes, The Telegraph and The Metro. Prior to Quote Goat, he worked in finance in the city for a number of firms including HSBC.
With credit being so accessible these days, many people find themselves carrying their debt from month to month, with no clear view to how they’re going to get out of their rut. Whether your debt is a minor annoyance or a massive financial burden, you’ll obviously want to get out of it as quickly and as easily as possible. Here, we’ve listed just a few of the proven tactics for getting yourself out of debt and back into stable personal finances.
Plug the Leaks
If one of the pipes in your home suddenly sprung a leak, the first thing on your mind would be plugging it as soon as possible. The same principle applies to getting out of debt. If you’ve got so much money constantly flowing out to lenders that you’re struggling to meet your basic needs with what’s left over, then your number one priority needs to be avoiding adding to that debt. One of the quickest ways to lower your spending is to become a cash-only buyer. This may surprise you, but ditching your plastic for a while can be exceedingly effective for getting out of debt. All it takes is enough self-discipline to wave away some of the more pleasurable and frivolous things that you’d usually spend money on. If you really can’t help yourself, shut your credit cards in a drawer somewhere, and save them for emergencies!
Give your Budget a Check-Up
Once you’ve put all your credit cards away, and done everything you can to grind down the debt you have, the next thing on your mind should be your personal budget. Start keeping tabs on every cent coming and going out of your accounts, ensuring you get a realistic idea of how much you can pay to lower your outstanding debt. If you’ve been leaning on credit cards for a while, you may be pretty surprised by the reality of your budget. However, if you can’t follow through and stay disciplined, you’re going to stay in debt for a very long time.
Take out a Loan
You may also want to consider a personal loan if you have tried getting out of credit card debt but can’t seem to manage. A loan gives you the benefit of fixed monthly payments that pay off your interest as well as the outstanding balance. If you put all of your credit card debt into a loan and then never touch your credit cards again, you will know that you will be debt free at the end of the loan term.