Tips to Thwart Bankruptcy

No matter the size of your debt, you still have to manage it properly. If you have a small debt, you should never miss on your payments to keep it from getting out of control. Otherwise, you just have to put more effort into managing it.

1. Set a monthly budget and use it.

When you have a budget, you can earmark your money accordingly so you have enough for monthly expenses. If you have any extra money, having a budget will make it easier to plan how to use it. As a matter of fact, you can use it to eliminate your debts much quicker.

2. Make the minimum payment (at the very least.)

2. If it's difficult for you to pay a large amount, at least pay the minimum requirement. That won't make a lot of difference, but it will certainly stop your debt from growing and you from going into default.

3. Prioritize your debts. 

Your credit card debt should always be number one connect. And the card that collects the highest interest should have the highest priority since it's the one that's eating up most of your money.

4. Identify your creditors and the amounts you owe each of them.

Create a list of your debts complete with details like the names of your credits, the total amount that you owe every one of them, how much your monthly payments are as well as your due dates. Go over your list from to time, especially as you make payments. You should update your list every few months to see how things change.

5. Pay on time.

Make use the calendar system on your smartphone or computer by entering your payments and setting the alarm to remind you a few days before another payment is due. If you must miss a payment, don't wait until the next due date arrives as by then, the miss could have been reported to a credit agency already.

6. Don't ignore collections as well as charge-offs.

If your debt repayment funds are limited, concentrate on maintaining a good standing for your other accounts. If some of your accounts have already damaged your credit, don't let your positive accounts follow suit. What you must do is settle all your past dues as soon as you can afford to.

7. Have a contingency fund.

No savings means having to borrow money in case of an emergency. Aiming for a $1,000 emergency fund is great for starters. Once you've reached your target, work towards a larger fund, like maybe twice as much as what you currently have. The goal is for you to save up to six months' worth of your living expenses. The main goal is to have you save up to six times your monthly living expenses. 

If you honestly believe you couldn't handle your debt situation by yourself, then it's time to see a debt relief specialist at https://sextonandwykoff.com/knoxville-chapter-7-bankruptcy/.  Other debt relief options usually include debt consolidation, debt settlement or filing for bankruptcy.