DEALING WITH DEBT - 6. THE SOLUTIONS Contd'

In our Last article, I talked about ways to start your journey to becoming debt free. Those steps majorly deal with our general disposition to debt. How you see a thing plays a huge role in how you relate with it. You can never be debt free as an individual until you see debt for what it truly is.

Here, we will be looking at how to get out if you ever find yourself in debt, no matter how deep. You can actually come out from any debt bond you find yourself in but there are things you have to do. So let us get down to them.

1.) Have a clear statement of your assets and liabilities:

I mentioned something similar to this in the last article, but from another angle. See what Prov 27:23 says "Be sure you know the condition of your flocks..." You must be able to state clearly what you own and owe, channels through which money comes to and goes from you. How regular you get money and spend money, i.e daily, weekly or monthly should not be left out. You must be able to answer all these questions frankly to be able to ascertain your financial position. Of the things you most likely listed as your assets which might include, car(s), television, designer wears etc, how many of them are really making money for you? I am not saying that you should not have them. But at this critical point, you will really need to come to face the real truth that some of those ‘assets’ are actually liabilities in disguise, as all they have done since you got them was to take away more of your resources and depreciate over time. Don’t be ashamed to sell off some things that have only cost you money. Things you don’t need, sell them off and use the money realized to settle your debt.

2.) Sit down and make a list of all the debts you owe.

Some people are so much into debt that they can’t really give an accurate detail as to how much they owe. This is not good. Sit down, take a pen and paper, and list all the people you are owing with the amounts you owe them. Rearrange them from the smallest to the biggest, or the periods when they will be due for payment, or any other way that represents your peculiar situation. This will give you an accurate picture of what you are really up against. Please don’t see this as hard work or expect someone else to do it for you. Your debt is your responsibility, so sit down and get to work. Getting an accurate picture will help you to see things as they really are. You will not be guessing or assuming. That knowledge alone can free you from the anxiety and fear that comes with facing what you do not really know or have enough details about. It will also help you to...

3.) Set up a repayment plan.

You need a plan. A workable one at that. So much is dependent on that. Lack of a good plan can throw you back into the same pit of debt that you are striving to come out from. Some experts suggests that you start paying off the debts from the largest to the smallest, while some others think and advise otherwise, mostly because of psychological reasons. Dave Ramsey advises that you focus on a particular debt and pay it off before you tackle another one, he calls it debt snowball method, while others will tell you to spread the repayment funds across the debts and reduce them bit by bit periodically. You can also break bigger sums into smaller sums and pay them off in piecemeal. Some people are waiting to get money in lump sums so as to pay off big debts. While this method works sometimes, it doesn’t really work most times. Learn to break the debt down into smaller bits, and be CONSISTENT in the payment. Overtime you will pay it off. For me, there is no hard and fast rule for paying off debts, it is different strokes for different folks. You can still tackle them depending on their due dates, as long as there are no interests mounting on the ones that you are yet to pay. All in all, any method that works for you is fine as long as you keep to it and achieve your repayment goal. The issue of debt freedom takes time to be achieved. Be patient, disciplined, and consistent.

Some other plans and personal financial policies you can make include;

-cutting back on expenses

-using major portions of unexpected incomes and increases to pay off debts.

-quitting vices that you have and use the money to pay off your debts: Smoking, drinking, womanizing, partying, betting etc. These things drain money from a person insidiously. You need to quit these harmful habits, and you the money to attack the debts hanging on your neck

4.) Get a job

And I mean anything legal, no matter the pay. You are owing people and it is a serious case, stop carrying your shoulders up and patrolling the neighborhood joining story to story, go and find a job and start earning something with which you will free yourself from the bondage of debt.

You can’t be owing people and stay at home without doing anything and expect money to drop down from heaven for you to clear your debts. I suspect that your creditors are merciful. Please get a job or start a business and start earning money. Some people prefer what I call corporate begging to swallowing their pride and engaging in seemingly ‘menial’ jobs. There is dignity they say, in labour. The bible captures it aptly in Prov. 14:23, “In every labour, there is profit…”

There are no menial jobs, we only have menial minds.

5.) Don’t live in flamboyance while you are owing people:

Hear me today, it is not good. You can’t be owing people and be parading yourself with the latest designer wears and gadgets while claiming not to have money to settle your debts. It is not good. Debt is a serious issue and therefore should be approached as such. For a short while, do well to deny yourself of some of those flashy things and channel those funds into paying off your debts. Once you are done with the debts, you can go back to those things(if they will improve your self worth. Some of them form the bedrock of the reasons you got into debt in the first place).

Also avoid people and places that drag you into lifestyles that will lead you to accumulating debts, including marketers who will come to sell fresh items to you on credit. Have the wisdom to say NO and mean it.

To be continued.

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