Whether it is paying off your mortgage or controlling your credit card bills, there are ways to manage debt no matter the size. With small amounts of debt, you must keep on top of repayments so things don’t spin out of control. However with larger amounts owing, more effort needs to be put into juggling repayments and working out which are most important to pay down first.
Budgeting is key to managing your debt appropriately, and while you may feel overwhelmed, it is important to always keep track of your finances.
Step one: Know how much you owe
This is a real and usually confronting fact that everyone who is in debt must recognise. You need to know how much you owe in order to appropriately pay down any debt you may have. If you have various repayments, you should list out when these are due, what the interest rate is and which are the most pressing to pay.
Step two: Plan out your repayments
Use tools such as an excel spreadsheet or your calendar to create repayment plans for yourself. These are meant to help you set reminders and ensure you keep on top of your finances. While there may be times you can not keep to your schedule, you must always consider which debts are the most important to pay off at that point in time. For example, credit cards are usually relatively important to pay off quickly due to their high-interest rates.
Step three: Budget for important expenses
While you may want to pay off your debt faster, remember to ensure you have enough money to cover your everyday expenses. Buying groceries and ensuring you have a roof over your head are all things you must budget for.
Step four: Recognise when you need support
At Wagtail Wealth, we are here to help you manage your debt and make sure you don’t always feel like you are in a crisis. Debt can be stressful, however managing it appropriately with the right resources will eventually give you the freedom you are searching for.
For more information, contact us today.
IMPORTANT NOTE: This information is general advice only and does not take into account your personal circumstances, goals and objectives. Therefore, you should consider its appropriateness for your circumstances before acting on this information.