New year, new ways to manage debt | pt. 2

Happy 2020 everyone!

There has never been a better time to dedicate yourself to new habits. Whether that is finally breaking the nail biting habit or making the conscious decision to FINALLY tackle that debt.

Trust us, your debt is manageable and we're going to tell you how.

How do I get back on track after the holidays?

Going a bit overboard for Christmas is normal. It's easy to do especially when you're in the holiday spirit.

Since the damage is done, you need to organize a payback plan. This plan prioritizes holiday debt. You are paying back all the money you spent over the holidays and nothing more.

Payback Plan Factors

  • Set up an automatic savings program with your bank to help you save and put aside a portion of your income without even thinking about it
  • Prepare a cash budget designed for daily/weekly purchases (groceries + gas)
  • Eliminate any miscellaneous spending with your debit card(s)
  • Freeze credit card transactions that are NOT mandatory payments

My holiday debt is taken care of, now what?!

Once the holiday debt is taken care of, you can continue utilizing your payback plan with your other debts.

This is a good time to sit down and manage all of your non-mandatory purchases. Those may include:

  • Subscriptions (magazines, food/beverage services, streaming services, video services, beauty products, e-commerce, apps, etc.)
  • Convenient Foods (fast-food, restaurants, food services, etc.)
  • Entertainment (concert tickets, movie tickets, travelling, sports events, etc.)
  • Other (memberships, miscellaneous purchases, etc.)

It may be time to pull the plug on one or two of your commitments until your debt is more manageable.

The money you save will be used directly towards your debt. Although it may change your lifestyle, it is a necessary step to take.

What if I'm way over my head in debt? 

If you feel like you need more help, you should contact a debt-management/credit counselling program for a consultation about your situation. They will let you know if debt consolidation is the best solution for you.

Although you may feel like reaching out is admitting defeat, it's actually a brave step to resolve your debt once and for all. Make 2020 a debt-free year! 

HomeHow Mortgage.