Enough is Enough: When to Seek Help for Your Debt
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Many of us have suffered with worry when the tentacles of debt have wrapped around us, suffocating our lives and restricting us from progressing. Sometimes a cut-off point emerges, where a single incident triggers a realization that all is not well. Sometimes an emergency occurs. And on other occasions, a number of small factors suddenly glue together and form into one inescapable conclusion: you need help for your debt.
Signs that You Need Help for your debt
There are several basic questions that should be the starting point in establishing whether your debt is manageable, or if further help is needed. Ask yourself:
- Are you struggling to meet basic monthly outgoings and essentials, such as mortgage/rent, bills, food, debts etc.?
- Are your total debts, excluding your mortgage, bigger than a year’s income? Is there any realistic way you can reduce the gap without borrowing further?
- Do you actually know where your money goes? Are there any outgoings on your monthly statement that appear correct, but for parts of your life that you don’t need any more or are irrelevant?
- Are you persistently getting reminders, both written and through phone calls, to pay accounts on any given month? Do you have several routes of credit but can’t remember when to pay them each month? Are there any accounts that regularly escape your mind completely?
- Is your credit rating dismal, to the point where any attempts to secure new credit are barred – even though you desperately need it?
- Are friends or family worried about you? Do they ask you about money, and your financial circumstances, with a tone of concern in their voice? Have these questions accelerated in frequency over the past few months?
You’ll know if the answer to these is yes or no, and whether this is a positive thing. Taken singly, each of these warning signs might be overcome; but if two or three are negative, it’s time to reassess.
While you might be able to alter or help your perilous financial state in the early stages, once it starts to affect your actual personal life – through phone calls from credit card companies and worried questioning from loved ones – it’s a sure sign you need to take action.
So what’s next? Actually, bizarrely enough, borrowing might be the way forward, but only to lump your debts into one place. The benefits of gaining a loan that can consolidate your existing debts are multiple. This is called a debt consolidation loan, and it means you only have one monthly payment to manage instead of several payments, which can be harder to keep track of and also increase stress.
In addition, seek a meeting with the creditors to attempt to gain more favorable terms, by increasing the number of months of the term and lowering the monthly payments. Other, more final options, include an IVA or bankruptcy; neither of these will ruin your life forever. From now on you have to be strong, with several months of cutting out luxuries and reshaping your finances ahead of you, it will be worth it in the long run when you get help for your debt.
Photo courtesy of: RyanMcGuire
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