Tips to Make Debt Management Easier
- February 9, 2021
- Posted by: Jaya R
- Category: Uncategorized
The debt trap is a reality. It was evident in a recent Standard Chartered survey published in UAE’s leading newspaper in December 2020. [MK1] In the survey, millennials (aged 25-44) were asked what they would do if the government gave them Dh 5,000 without any obligations. An overwhelming 45% of respondents said they would use the money to pay off debt or cover living expenses. Nearly 34% of the millennials said their borrowings have increased over the past month.
In such times, everyone must adapt to the new reality to make things easier for themselves and their families. However, no matter how much they owe, there are always ways to manage debt and get out of it.
Ways to Manage Debt
Borrowers should assess their financial situation, their debt commitments, and their monthly cash inflows and outflows. There is little one can do to increase their income in these difficult times, but people can do a lot on the cash outflows front. One should make a budget and try and cut down on unnecessary expenses. Getting a clear picture of debt helps in creating savings to pay off debt.
Ensure Timely Payment of Dues
No matter how large the current debt is, one should ensure the debt situation does not worsen. Borrowers should make timely payment of dues, especially those which can lead to interest expenses. That way, borrowers must worry only about settling their existing debt, without worrying about debt piling.
Debt can be overwhelming, and people want to get rid of it as soon as they can. However, one must go a little easy on themselves and be realistic. They should create room for repayments on an ongoing basis. For example, increasing EMIs is one effective way of repaying debt. This way, the debt gets reduced. Also, one does not have to worry too much about budgeting as the remaining funds are available for consumption.
Review Your Debt Situation Periodically
While it is useful to create an action plan, it is essential to stick to it. Periodically reviewing the debt situation helps people in understanding whether the problem is improving or not. If the debt situation is still the same, it may call for greater financial discipline.
Seek the Help of Professionals
Professional debt management firms have lots of experience dealing with various debt situations and getting borrowers out of debt. While the crisis may be overwhelming for individuals and their families, taking professional help can provide much relief. With years of experience in debt management, professionals know of techniques that individuals may not know.
How Can Freed Help?
FREED Financial Services specializes in mortgage debt management. Its team of experts has 40+ years of experience in sectors like banking and real estate. FREED understands that each borrower’s situation is unique, and there is no one-size-fits-all solution. FREED provides customized debt management solutions based on the individual debt management needs of every borrower. FREED helps borrowers either close their home loan entirely or moderate it to manageable levels by offering various remedial measures such as settlement or debt restructuring.