Find out how to catch up and start the year without debt

New Year New Life! This is a maxim that many people repeat at this time of balance of the past and plans for the future. But, it makes little sense to think of a new life without eliminating old debt. That’s why we prepared this post, which will help you take action, to catch up and start 2017 more smoothly.


Set priorities

debt loan

Have you noticed how many times people complain that they can’t afford some major expenses but are always spending on superfluous things? If you identify with this situation, the first step in controlling your expenses and getting your bills up to date is to set the priorities for your expenses by putting debt repayments between them.

But that doesn’t mean you have to. Is not it. It is only necessary to measure spending, setting limits on what is not truly essential and prioritizing what cannot be missed or represents a goal in life.

For example, if you like hanging out with friends, don’t give up on that. After all, it is very good to maintain friendships and have fun with them. However, that outflows are often compatible with your budget and your spending on them is also balanced.


Control your spending

Control your spending

Do you know how much you spend each month on each item of your expenses? Controlling spending is a very important aspect for those who want to balance the budget and pay off debts. Looking closely at your expenses, knowing where your money goes in detail, you will be able to detect unnecessary or excessive spending and points where you can save.

For example, you may find that you are spending excessively on electricity or water, which may guide new consumption habits that allow for some savings.


Spend less than you earn

Spend less than you earn

This is an obvious recipe, but one that many people do not apply and that is basic for those who want to get rid of debt. Of course, once you can balance your budget and spend less than your debts get, they will start to disappear.


Recognize the benefits

debt benefits

Many times people complain that they are in debt, as if the debt had come out of nowhere, without considering that the debt was taken to fulfill some wish or to meet some commitment. Now, if you understand that you have gone into debt for a benefit, it is much easier to deal with the need to pay off what you owe in order to keep credit open if it is needed again in the future.


If necessary, renegotiate

debt renegotiate

However, of course, even recognizing the benefit, you may not be in a comfortable position to settle the entire outstanding balance at one time or in the face of interest that may have been contracted. In this case, go to your lender and propose a renegotiation, making it clear that your interest is not in taking advantage of the situation, but only in getting it right.

Lately, several debt renegotiation programs are easing the debt situation, and one of them can be a way out for the US.


Pay off debts

Pay off debts

There is a big difference between circumventing a debt and running away from the lender and facing it and trying to pay it back. Therefore, it is essential that you truly propose to repay the debt you owe and strive for it.

This is also a key aspect of keeping your name clean on the square. Remember: this is a great asset that one should not give up.


Research before you buy


Saving does not always mean stopping buying or hiring a service. Nor does it mean that you should give up quality. None of it. If you start researching before you buy anything, your chances of finding more favorable prices and payment terms increase, which will mean some savings.

It is always worth remembering that any savings are good for those who want to get rid of debt.


Forecast expenses

Forecast expenses

The beginning of the year is the time to pay the expenses with IPVA, IPTU, enrollment, among others. Do you know how much you will have to spend to cover these and other routine expenses? Do you have a reservation for these appointments? Are your party and travel expenses during this period compatible with what you earn and your expenses and debt?

By answering these questions you will have a good forecast of your financial situation for the early months of the year which are usually quite tight. Try to balance everything out of control and increase your problem.

Without this forecast, besides being unable to eliminate the debts you already have, it is even possible that you need to contract others to cover all the expenses.


Make a financial reservation

money loan

Putting all the tips you have seen so far into practice, it is very likely that the path to getting rid of debt lies ahead of you. However, there will be the after, that moment when you have already managed to balance your budget, which may be shaken by an unforeseen event – such as a car malfunction, for example, or a new desire, such as a trip or buying an apartment

To guard against these situations as much as possible right now, even if you are trying to pay off your debts, try to start forming a financial reserve that you can use in those unplanned situations that may arise. With this book you will have much more security to keep your budget balanced and remain debt free which you will finally pay off in 2017.


Set goals

Set goals

Living one day at a time, paying attention only to what is happening in the present is a great measure against stress, so many say. But even those who think this way can and should set consistent goals that help in the development of life.

Those who live longing to achieve goals and the means they will use to achieve them have much more peace of mind to live the present without stress.


Plan your next steps

money plan

If we are talking about goals, of course, we need to talk about planning. Planning that has well-defined goals allows you to easily see how your personal cash flow flows, knowing exactly when you will have to spend on the listed goals.

This way you can also predict how much your budget should be directed towards paying off debts that need to be prominent in your set of goals.

Once you have a grip on your financial situation and know exactly what you will do to settle your debts, it is also time to plan future steps. After all, without this planning, you run the risk of getting into debt again and going back to square one.

To help with this walk, we have prepared the “Understand how to avoid mistakes in financial planning” post, which will be very helpful in this next step.