by Heather, February 14, 2014
Does debt = stress in your life? I don’t care if you are low income, middle income or the top 1% of the income bracket with a mortgage on your castle, debt of some sort surrounds each of us. For many, it is stressful, consumes waking moments and fills many restless nights. If you find yourself waking up to panic and worry about how to pay the bills, here are a few tips to help you learn to control your debt and not stress out (as much, anyway).
Since pretty much everyone has some sort of debt hanging over their heads, it is safe to say that knowing how to control your debt is the key to not letting your debt control you. So what can you do to help manage?
Acknowledge and Accept It
Maybe you don’t even know the extent of debt that you are in. It is time to face facts, add it up and structure your debt. The first step to taking control of it is to know where it is and how much. Yes, it is ugly and scary, but knowledge is power and you can have better control when you know what you need to manage.
Drop the Blame
Once you have your numbers in front of you, it is easy to see if mistakes have been made to get you where you are and look to the blame game. But to move forward, you have to accept it and forget about blame. Forgive yourself and look for ways you can correct the pattern that got you where you are today. Even if the debt grew due to a loss of a job or something that you cannot control, it is time to take action and move forward.
Structure Your Debt and Set Goals
Once you know what you have to deal with, structure your debt and start a process of paying it down. Make the tough phone calls and ask for help, if necessary. Many debtors would rather work with you than have you file for bankruptcy. Set reasonable repayment goals and stick to them. Focus on the smallest debts first and get them paid off as fast as possible. Each one you knock out makes it less stressful and gives you more cash along the way to keep paying down other bills.
Set an Emergency Fund
For many people, having nothing to fall back on also can cause a lot of stress and will add to additional debt should the car break down or a medical crisis occurs. Start paying yourself first and begin accumulating an emergency fund. This should be at least one to three months of normal monthly expenses. It is worth your peace of mind!
Take a Deep Breath and Relax
Control what you can and relax. Once you have the processes in place, you can relax and not stress out about the debt. That gives you even more control over your debt reduction. That, in a nutshell, is the whole purpose to this journey.
Use these tips to control debt in your life and get rid of the stress! Share with us what tips you may have used to control your debt. We want to know!