Complete guide: how to settle debts

Unfortunately, the consumer profiles of the new times are causing people to spend more than they can afford.

The desire to buy, especially items that are not needed at any given time, ends up generating a snowball effect, where debts never end and only increase.

Do not be thinking that you are the only Brazilian in this situation, as there are thousands of others who also have their bills in the red, but are looking to pay off debts in order to be able to breathe a little easier.

Credit card purchases, high limits, among other “benefits” granted by banking institutions end up causing people to spend far beyond what they really need and then get involved in a tangle of interest, thus creating an accumulation of debt.

Getting out of this type of situation is very complicated and requires a lot of financial organization.

Do you want to pay off your debts this year? Check out the complete guide we have prepared for you!

Understand how to get out of the crisis and pay off your debts!

The fear of not having money, of not being able to pay their bills is terrifying, some see new loans as a solution to settle their debts partially.

However, banking institutions are also more demanding to grant credit, and therefore the situation is even more complicated.

Thanks to the new consumption profile, people are consuming more and paying less, increasing the financial risks that a bank assumes when granting credit.

But to offset this scenario, banks raise interest rates so that the risk of the loan is offset. Without credit in the “square”, the economy paralyzes.

According to this concept, it is not bad to make debts, the problem is when it is not possible to pay them. After all, credit is one of the biggest stimuli of commerce and also of the consumer, that with sales happening, it is possible to generate new job opportunities, managing to “rotate” the economy.

When the credit process is stagnant, all that gear is compromised, where jobs are scarcer and debts increase.

The consumer can and should make purchases, even if they are in installments, but it is important that they are paid, because when there is uncontrolled, and the accounts exceed more than ¼ of their net income, the trend is that the debts just grow, becoming each more and more complicated to break free.

Unemployment, high interest rates, excessive purchases, these are all factors that contribute to the increase in debts, but now it is necessary to understand how to pay off debts and start to breathe easier.

The first measure is to “clear the name”, that is, eliminate credit restrictions in the controlling financial institutions, such as SPC and SERASA, this needs to be your first priority.

In order to be able to clear yours from creditors and remove your name from the list of restrictions, it is important to get an agreement that is interesting between you and the lender.

If the creditor has an interest in receiving and you in paying, then an attractive agreement with lower interest is the best idea, find a middle ground where it is possible for you to honor with the agreed installments.

Find out how you got into debt

First of all, you need to understand how your financial situation got to where it is.

Most of the time, debts do not arise from external factors, they arise from financial uncontrol, from excessive purchases, many social events with a high cost, among other factors.

It is important to identify the reasons and be aware of the factors that led you to that moment. It is useless to settle debts, but to acquire them again, as you have not yet acquired the culture that expenses need to be identified and controlled.

Usually, the time of the 13th salary is to settle debts made throughout the year. But have you ever thought if it could be used to make a dream come true, like creating savings or a trip? For this to be possible, it is necessary to understand, organize and control spending.

Know the total value of all your debts

For you to be able to adjust your accounts and have a good negotiation with creditors, the first attitude is to put order in the accounts, after all how is it possible to negotiate if you do not know the total amount of your debt, how much you are in debt.

Knowing what the real value of your doubts is the key point for a successful negotiation, that way you can find out which products were contracted and the interest rates that are involved.

At first, it is possible that it will not be possible to settle all debts, since the budget is tight, but if you know all the details that are involved it is possible to prioritize the payment of debts that are more important than they can turn over. a “snowball” at any time.

In order for you to be better organized, create a spreadsheet or even an agenda, put the name of the creditor, the total amount of debt outstanding, interest rate and the proposal of agreement made by the creditor.

Do this for all debts, so that you can get a sense of everything that is involved, as well as what are possible to pay off at that time.

Organize your personal finances

The organization of your personal finances is the second most important point, because even if you are aware of all debts and the value of each one, it is useless if you have control over your expenses.

The domestic budget needs to be studied calmly, so that it is possible to work out the limits and define how the debts will be paid, without compromising the payment of other expenses.

Set goals for your consumption, so that you can maintain control over your spending.

It can be understood as a home accounting process, where the expenses cannot exceed x% of the total income or a predetermined amount, once the limit has been exceeded, the expenses must not continue in order not to uncontroll the family budget.

Don’t forget that all expenses need to be noted and controlled, even that afternoon coffee needs to be noted, so that in the end you understand your consumption profile and know exactly what to cut to save.

Do not be fooled by splitting items into several small installments, as they may seem to be more advantageous, as you are buying an item of medium to high value and paying in small monthly installments, but several small installments can result in a very big problem.

Reduce your fixed expenses, try to spend less on items that are not needed, avoid unnecessary purchases.

Use planning as a weapon to reduce spending and get out of debt so you can get out of the red.

It is necessary to create a culture that, it is not necessary to earn more to be able to pay off debts, it is important to control spending, regardless of monthly earnings.

Managing all available resources

In addition to the monthly earnings, add all kinds of extra money that you will receive, put in the account PL – Profit sharing (if your company pays), refunds of amounts paid to the health plan, extra income, IR – Income tax and the 13th salary.

All resources need to be accounted for as well as your credit dates, so that you can plan to settle your debts.

At the moment when you are looking to “unburden” your debts, any appeal is welcome. But when you get a little better, it’s time to start organizing these resources to save. Start thinking about building a financial mattress. 

The change in the culture of spending to save is important, as it demonstrates the change in the consumption profile as well as the concern with your finances. If you want to know how to transform your financial life, get to know Debt Free , training offered by the Financial Coach Institute.

 

by Abdullah Sam
I’m a teacher, researcher and writer. I write about study subjects to improve the learning of college and university students. I write top Quality study notes Mostly, Tech, Games, Education, And Solutions/Tips and Tricks. I am a person who helps students to acquire knowledge, competence or virtue.

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