Getting into debt can be a rather intimidating situation to find yourself in. Sometimes, it can seem like you’ll never work your way back into the black. But not to worry, there are certain things that you can do to help yourself along the way. Here’s the ultimate checklist to work your way out of debt!
Check Your Credit Score
Surprisingly, there are many people who have never taken a look at their credit score! There are various reasons that you should keep an eye on yours. Firstly, it allows you to see where you stand in regards to your overall financial health. You can also keep your credit in good shape, and you will have a good idea as to whether your credit applications will be successful or not. Until recently, you’d have to sign up for an account, subscribing and paying to take a look at your personal credit rating. The good news is that nowadays there are various services that will allow you to check your personal credit score for free.
Consolidate Your Debts
Debt consolidation is essentially the act of negotiating a loan that will be used to pay off several existing loans. These usually include outstanding credit card balances. Now, there are various reasons that you may want to consider doing this. The first: to save money. When you’re trying to keep on top of numerous debts, you can often end up missing repayment dates and will land yourself with fees and fines. Your consolidation debt may also have a lower overall interest rate than your existing debts. Take a look at debt consolidation loans for bad credit to see what’s available to you.
Do a Balance Transfer
If you have more than one credit card, but the idea of a consolidation loan doesn’t appeal to you, you might want to consider a balance transfer. The process involves all of your debts from one credit card to another. Sure, this may seem pointless, but many cards offer interest-free balance transfers so you can save yourself from paying interest for an allotted period of time. This means you can focus on clearing your debts rather than simply meeting interest repayments.
Close Unused Accounts
As you start clearing your accounts, you’re likely to want to reduce your credit usage in general. If you want to ensure that you don’t continue to dip into your credit allowance again, you can always close your unused accounts. Simply phone up your issuer, they will be able to cancel things over the phone. If you do leave your account unused, your credit issuer may take matters into their own hands and close your accounts anyway.
We get into debt because we live beyond our means, or spend money that we simply don’t have. So as you begin to rectify the situation, it’s time to start budgeting! Find a complete guide to budgeting here.
These small steps can make all the difference when it comes to working your way out of debt. So get started today!