The topic of getting rid of debt is relevant to most people. Few have such valuable financial freedom and are not burdened with any debt. This refers both to the debts of friends, acquaintances, relatives, and various bank loans. Debt is one of the hardest burdens to bear. Especially morally – the understanding that you must press on the soul.
There are several ways to get rid of debt.
Let’s start with the ones that cannot be categorically used:
Method 1: Borrow money to pay off old debts. Obtain a loan from a bank to pay off a loan from another bank.
Remember once and for all! Never do this! Do not even think about it! This is a debt hole that you will never get out of. Especially when it comes to bank loans. Don’t use this method, even under penalty of death or something like that. Later, you will never get out of such a hole and such a life in the style of “there I will borrow again, then I will intercept”. In this case, you are condemned to a miserable existence to pay off all your debts.
Method 2. Take a debt to make the decision not to repay it.
This way, of course, you will get rid of debts, but remember your creditors. If it’s friends and acquaintances or relatives, who are you after that? What is the name of a person who throws up his loved ones? Make up a name yourself. What if your creditor is a bank? The bank itself will not run after you. Your debt will be transferred to a collection company (for those of you who don’t know, a collection company is an organization that deals with debt collection. They have many forms, from legal to completely illegal). And these guys won’t stay in tune with you. In general, you will create a lot of problems, ruin a lot of nerves, and still pay you back. That’s it.
So you shouldn’t play and spin. Since we have borrowed, please return it. This approach will provide you with invaluable benefits and teach you a lesson that you will learn throughout your life.
Let’s see how we can get rid of debt, so to speak, “legally.” It’s very simple, you just need to give up the debt. That’s it. How can you do this?
There is a small, but simple and affordable method for quick debt collection.
I’m just warning you right away that it won’t happen in a day or a week. It does need a bit of work, but it will help you a lot.
1. You must know exactly how much you owe. If it’s a loan from a bank, find out how interest is calculated and how much you will owe tomorrow, the day after tomorrow.
The idea is that you know how much you owe at any given time. This is very important because when you have a specific amount of debt in your head, it is psychologically easier for you to tune in to the fact that it needs to be paid back than when you think: Oh, I owe so much that it is scary to even think! This approach will not help you get out of debt early.
When you find yourself in a situation where it is difficult for you to repay the loan, it would be wise to contact the bank. As a general rule, banks are halfway with responsible customers and can offer restructuring to ease the credit burden. Restructuring is the lender’s actions to change the terms of the loan repayment. For example, the bank can extend the term of the contract, because payments are spread over a longer period, and its monthly amount is reduced, or allow so-called “credit holidays” when during a given period it only pays interest on the loan.
2. You must know exactly the amount of your income per month and most importantly, expenses per month. It’s very important. Much depends on the number of expenses on the speed of getting rid of debts. You need to know these amounts exactly, and not roughly, as many believe, from month to month in different ways. NO, you must know these amounts clearly.
3. You should spend less in life than you earn and save the difference. You should start saving as much as possible for yourself. The maximum is shorter. And all this maximum should be used to pay off debts or debts.
Don’t be lazy and save as much as is acceptable to you. Nobody forces you to live from day to day, etc., but remember that debt, especially bank loans, are holes in your financial budget, this is money that you could spend on yourself. Therefore, it is in your best interest to get rid of them as soon as possible.