Personal financial planning: Tips to control and get rid of debt

In case people find themselves sinking deeper into debts, it is time for them to sit up and take charge of the situation in order to tame the menace before it causes irrevocable damage. They should be aware of their disposable income and keep track of their spending. There are many who are earnestly seeking answers to their queries regarding how to eliminate debt .As a reply to their queries, this article has been composed to comprehensively discuss few strategies that will help them to resolve their debt problems.
Debt elimination strategies
Debtors may follow the below mentioned strategies in order to control their debt and repay them easily:
1) Arrange all the debts – Debtors have to make a list of all the financial obligations that have been bothering them. They must include all the details of every creditor in the list. For instance, name, address, phone number, type of loan, rate of interest, outstanding balance to be repaid, etc should be there in the list.
2) Use of online resources – Debtors can take advantage of the free personal financial planning calculators and software to develop a well crafted budget and a debt repayment plan. This will help them to keep an eye on their expenditures and stop increasing the debt amount further.
3) Build an emergency fund – An integral part of the debt elimination plan that can help people eliminate debt is to build an emergency fund. This will protect their finances during rainy days that may wreak havoc on their already weakened financial health. Moreover, it will also shift their dependency on the credit cards. For that reason, debtors can have a certificate of deposit account that is more useful than savings accounts to meet the objective of having an emergency fund.
4) Pay off expensive debts – This strategy will help debtors to repay the debts that have been brought with high rate of interest. As a result, it will save them a lot of money by quickening up debt repayments and making the least interest payments. However, they can also start off with repaying the most minimal outstanding balance first and gradually moving higher up the ladder.
5) Aggressive debt repayment approach – According some debt experts, debtors must pursue their goal of becoming debt free with a renewed vengeance and determination. In all, they should be aggressively following their self-crafted debt repayment plan and budget. This is because while going through the budget, they must keep in their mind that every dollar is crucial for them. Debtors must not forget that every penny saved is every penny earned that will help them to make extra debt payments.
Finally, debtors can speak to their creditors and, ask for some waivers on the penalty charges and some compromise on making the payments. However, before approaching them debtors must have a clear repayment plan and an indomitable urge to pay off all the outstanding balance so as to convince the creditors for the same.