The perspective behind clearing your debt

The following article will give you a perspective of how you can clear your debt and stay solvent.

10:37 06 January 2014

Mounting debt sometimes cripples a household. Just like the proverbial crack in the dam before the flood, fixing debt before it becomes big is important to staying solvent.

It is very easy to get into debt if you do not pay attention the very obvious signs on the wall. When you are plunged into insolvency, duct tape fixes are not just going to cut it.

• Admit That There is s Problem

If you are in debt and you deny that you have a problem, then you will barely keep your head above water. Hiding from your debts means that they will not go away no matter how hard you wish them away.

• Know Where You Stand

 

If you know where you stand, then you can take corrective measures and do away with debt completely. This means that you have to critically examine a few things:

• How much am I earning?
• What are my expenditures and how are they?
• How much do I put in my personal kitty?
• How much is my debt and who are my debtors?

When you can accurately answer the above questions, then you are almost there on identifying your financial standing. Chances are that you will identify the holes in which your pockets are leaking and it upon you to take corrective steps. A lot of people struggle to determine their financial status and hence succumb to debt crisis no matter how hard they try to solve it. Try to answer these questions honestly, and if possible raise more questions that give you a tinge of reality about your current financial position.

• Come Up With a Realistic Repayment Strategy

When you have identified the holes, plugging them is the next step. You should identify the most urgent debts that you have and pay them as quickly as possible. Basically you should get rid of excesses and you will be fine.

If you are going to beat debt and win, you have to be proactive and smart about it.