If you’re anything like the average American, you have about $38,000 in personal debt. If you’ve got a mortgage, your debt is probably in six figures.
For starters, being in debt isn’t a bad thing. Loans build our credit and help us to purchase big-ticket items we couldn’t otherwise afford in cash. As long as you’re able to service your loans comfortably, there’s nothing to fear.
However, if you’re deep in debt and you’re struggling to offset your loans, you could end in a financial disaster. If you’re in this situation, it’s easy to feel helpless.
We’re here to help!
Continue reading to learn how you can climb out of your financial hole and reclaim financial health.
Avoid Making More Financial Mistakes
When you’re in a hole, stop digging!
Similarly, when you’re in deep debt, stop taking in more debt and making other mistakes that will only worsen your situation. Ironically, people who are in debt are more prone to incurring more debt.
Perhaps you want to borrow money to repay lenders who’re giving you sleepless nights. Well, if you have to borrow more money, ensure you’re doing so from lenders who offer easy loans with flexible repayments. Be sure to discover more about these types of lenders before making an application.
Bankruptcy Could Be an Ideal Option
When you’re deep in debt, it means there’s no quick-fix to your financial problems. Unless you hit a jackpot or inherit a windfall, it’s certainly going to take you several months or even years to claw your way up.
This is why bankruptcy could be an ideal option for you.
Most people shy away from filing for bankruptcy because of the consequences. Yes, the event will stay on your credit report for at least seven years (depending on whether you file for Chapter 7 or Chapter 13 bankruptcy) but it will give you the time you need to reorganize your finances and thrash out new repayment plans with your lenders. In fact, some of your debt could be discharged.
That being said, deciding to file for bankruptcy isn’t a light decision. It’s advisable to consult a bankruptcy attorney before making the move.
Look for Ways to Boost Your Income
You’re in a massive hole of debt because your current income isn’t able to offset what you owe. It’s for this reason looking for ways to boost your income can be an effective way to get out of debt.
If you have a regular job, find a suitable side hustle. If you have a passion for pets, for example, why not take a part-time pet sitting job? If the market is good, you could even start a small pet sitting business.
With a bigger income, you’ll be able to allocate more money to service your loans.
Being Deep in Debt Isn’t a Permanent Sentence
Falling into deep debt is easy, climbing out of the hole is hard. However, it’s not an impossible mission. With good financial discipline coupled with the financial tips fleshed out in this article, you can stop being deep in debt and even achieve financial freedom.
All the best and keep reading our blog for more consumer tips and insights.