Debt unfortunately isn’t just a financial issues it takes hold of all elements in your life. There are a variety of solutions that you can do to control spiralling debt. Budgeting with the aid of spreadsheets, cutting costs or simply getting help in the form of making affordable payments towards your debt with Scottish Trust Deed all these steps can lead you to financial freedom.
Address The Debt
The first step with any problem is admitting it. This process will be one of the toughest as you need to set aside some time one day to collect all the documents you need and calculate how much debt you need to pay off. Make sure to collect all credit card bills, calculate any overdrafts you may have, include any loans you have taken out and any other debts. Once you have calculated your debt you can take these steps to pay off the debt and control it.
Create A Budget
After you have calculated all of your debt the next step will be setting up and creating your budget in physical form. The best way to set up a budget is to create a spreadsheet for this you will also need to set aside some time. Collect your latest pay slips, bills, and any other monthly expenses you pay that way you can calculate all incomings and all your outgoings. To set up your monthly spreadsheet have a column dedicated to your monthly income, a column for your bills and how much they are. In this spreadsheet include a column of all your debt and the amount you owe, in a separate column put the minimum payment you can afford to make each month. That way you will be able to track all payments that have to be paid that month and what you have left to live off.
Cut Back On Spending
Once you have created your budget make sure you stick to it by paying off all the essentials and cut out luxuries. If you cut back on your spending not only will you be able to control your spiralling debt by paying it off it will ensure that you don’t get back into debt. Make small cut backs and only buy things you need. It has also been scientifically proven that paying in cash is much more painful then swiping y our card so try to make cash payments when food shopping as you will be less likely to add treats to your basket. When shopping look to buy house brands as they are often cheaper, take lunch to work with you and avoid that coffee on the way to work. All these small cut backs will add up over the month and the money you would have spent can be added to paying off your debt.
Track Your Progress
Being frugal with money can be a real challenge so make sure you keep track of your progress. Every time pay day rolls around be sure to update your spreadsheet to make sure you’re keeping on track with paying off debt and your monthly expenses. Each month you should be able to see that debt slowly shrinking. You will also be able to calculate how many months you have left until you’re debt-free- which will give you a sense of relief.
Save For A Rainy Day
A good idea is to set up a savings account if you don’t already have one for a rainy day or for an emergency. It is important to have an emergency fund while you’re paying off debt in case unexpected expenses come up. You may be tempted to revert back to credit cards which will increase your debt, so the emergency fund protects your debt payments. If you start a savings account make sure you leave it for emergencies only. Once your debt has been paid off you can add those payments to your savings account so you won’t revert back to debt filled days- you’ll have savings for the future too.
