For those of us who have had a rough time getting their finances in order, and want to make the transition toward saving for your future, I’ve outline a game plan,. Here you can find the steps toward getting out of debt and making a transition to a better future. Retirement being the goal, we’ll break down the ways to get out of debt, stay out of it, and finally start making smart investments, and plans to make your way to a comfortable retirement.
1. Start paying your bills on time: We kick things off with a tricky one. Some of us are here because we can’t get this step in order, so let’s address this challenge head on. Whether you have too many bills, or just too high of bills, here’s a way to handle this. Consider consolidating your debt through a management service. They will talk to your creditors and negotiate a lower price for your debts and pay them off immediately. You can then develop a payment plan with them, to pay the bulk of your debt off together. You can search the internet for debt service reviews. Always keep in mind that the sooner you pay off your debts, the sooner you’ll be free of interest charges and late fees
2. Once you’ve set up payment plans, try to pay more than your minimum payment each time. It will vastly help you to get to ahead of your plan in case of an emergency. Always think ‘Rainy day fund’. This mentality will remind you not to spend on frivolous things.
3. On point with number 2, consider how much income you have, factor in your debt and then watch what you spend. You debt to income ratio is an important factor in considering when you’ll get out of debt.
4. Don’t fall into the traps. Stores may offer you special deals for credit cards, or you may get some in the mail. This is not a lifeline. These companies are not out to help you, only trapping you further into the debt cycle. Don’t sign up for any offers that you haven’t fully researched, if at all.
5. Now is the time to save. Be in the now, and buy the essentials. The more you remember that spending that extra dollar isn’t going to pay off in the future, the more you can focus on saving.
Once you break the cycle of owing your creditors, consider ditching your credit cards. Cancel all but one, and leave it at home. You should only use this last card for emergencies. If you can get to this point you will be able to plan for a great retirement, and some solid, sane investments. No one wants to go back into debt, so before you jump into any more payment plans, talk to a financial advisor and think seriously about the future. Remember to always think before you act, and always pay your bills on time.