Hopefully by now you have made many exciting summer memories. With the Labour Day long weekend still to come, there is still time to make some more.
With bad debt however, there may be the worry that having fun will mean spending a lot to money. Of course, since you don’t want to add more debt to the amount you already have and want to try and instead improve your finances before the end of summer – here are 3 ways you can improve your bad debt situation by Labour Day.
1. Creating a Realistic Budget
While this really is the first step in your overall path towards paying off your debts, it is of course a very critical one. If you truly want to reduce your debt and in a very short period of time, then creating a budget and sticking to it, is the best method of moving forward with this goal.
Just as the heading states, it is important to make sure that the budget you are devising is realistic to your financial situation. For instance, if you plan to budget to an extreme that is too far-reaching for you, then what is likely to happen is that you will end up adding to your debt as opposed to lessening it as you have originally intended.
Instead, setting up a budget that aligns with the income you have coming in as well as your current expenses will better enable you to not accumulate further debt, even moving closer to saving money and paying down this debt.
2. Cutting Down Your Costs
If it is unlikely that earning more money may not be an option, cutting down on your current costs may be the better method of being able to pay down some of your debt. If you are able to cut down your weekly and monthly expenses, you can redirect this money into paying off a chuck of your debts.
While in this shorter amount of time you may not be able to a large portion, you can begin to use this strategy to initiate a ongoing pattern of using this extra money to pay down your debts in a more significant manner. That being said however, even ridding yourself of some of your debt and improving your bad debt situation in the beginning is a good place to start.
Here, you will have to take a closer look at your personal expenses and which ones can you realistically cut back on. For example, can you reduce your grocery bill or find household products for less? Ultimately, whichever areas you find suitable, the goal is to lower the amount you are paying towards your overall expenses, as well as using this money for immediate debt repayment.
3. Consolidating your Debts
Another method of improving your bad debt situation by September is to consider consolidating your debts. With a lot of debt, one way you can begin to lower your debt as well as making it easier to start paying it down faster is to combine your debt into one loan with one payment, not to mention a lower interest rate. All in all, putting your debt in one place, for example, your credit cards, your mortgage, your line of credit, and so on can really help you speed up your debt repayment plan.
In the end, paying down your debt can be achievable when the right strategies are in place. With a brief time frame for when you want to meet these goals, you will want to look at methods of debt repayment that are the most realistic and effective for your type of debt, the amount of debt, as well as your current lifestyle and financial needs.
Debt doesn’t have to be a reality for you forever. Instead, the sooner you move ahead with your debt relief plans, the sooner you will see an overall difference in your current bad debt situation