One of the major things stopping people from moving forward is the huge debt they have incurred as a result of one or two challenges.
Most people take loans to pay off debts and take another loan again to survive and this cycle goes on and on.
When it comes to financial intelligence, not everyone has the flair for it hence the reason the poor keeps getting poorer and the rich keeps getting richer.
After looking at the crises most people face, we have come up with five ways one can avoid getting into such a fix.
1. Know How Much You Owe: the first step is to make sure you keep an inventory of all your debts. Write it down in a diary with dates and appropriate names attached to it.
2. Pay Your Bills on Time Each Month: I know this can be hard especially if you don’t have a steady income. But make a conscious effort to pay your bills on time. Don’t wait till the last minute before running around looking for money to pay it. As soon as any money comes into your hand, be disciplined enough to pay it.
3. Create a Monthly Bill Payment Calendar: this process is like a budget. You must create an excel sheet to track your bills. You don’t necessarily need a laptop to do this. You can use your phone and if your phone is too complicated, buy a notepad which is less than 5 cedis and use it to create the bill calendar.
4. Make at least the Minimum Payment: let’s assume you owe about four people 25k. Instead of paying huge amounts at the same time, agree with the person and pay the least amount first. This will help you keep some amount of money for basic things like food, water and transportation. Don’t pay all at once and end up completely broke.
5. Decide Which Debts to Pay Off First: this can happen if you write down your debts so that you know which one is urgent for you to pay back.
6. Build an Emergency Fund to Fall Back On: This is more like a contingency plan. This is to make sure that in times of emergency, you can always have money to help you out.
7. Recognize the Signs That You Need Help: No matter how prideful you are, never be shy to ask for help. Seek financial advice if you have some money and want to invest. Go to your bankers and purchase some bonds or treasure bills. Also, open up to people you trust before you end up getting swallowed in your debt.
You can’t follow the about rules if you are not disciplined or you are a spendthrift.