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How to Get Out of Debt?
As people say, there are only two things that are constant in this world – debt and taxes. So how to Get Out of Debt? There is nothing that we can do about taxes but debt is manageable or at least within our control. So how do we get out of debt? How can we be debt-free?
Debt is a Luxury from the Developed World
In the developed world, debt is something we learned to live with. Most people in the USA have thousands of dollars in school debt, and then you start buying a house or car and the debt just gets bigger. In rural areas around the world, there is nothing to buy and the school is mostly free, so there is little or no debt. In some areas, they even lack money, and people trade as the developed countries did a long time before.
Why do we Get “In Debt”?
The reason we have debt is due to the loans that we got from the bank, like The Bank of America, for instance. We also have debts when we have credit cards, and use it to buy stuff without paying it on time. When we loan money from our friends or other financial institutions we accumulate debt. Some countries do not eliminate debt by death, so if your parents or spouse are in debt, you will inherit debt and not wealth. This is something that most people think is unfair. The constant consumerism around the world pushes us deeper into debt; buying things we can not afford to fit in with others.
Is Debt Bad?
Did you know the richest men are deep in debt? Not because they have to, but they are tax planning. For example, is the Tesla owner’s debt bad? Not really, it depends on how you use debt.
Getting out of debt is much easier when you simplify your debts. You could apply for debt relief, or go for debt consolidation by combining similar debts and similar loans into one. In this manner, you will only deal with one payment every month. Then work with your bank or a financial institution to set up monthly payments for your consolidated debt. Then choose either to lower or reduce your monthly expenses, or find a way to increase your monthly income. In some countries you actually need to get credit, and spend money to work your credit score. Debt could also help you to get a house, and stop renting and that might save you money in the long time. But defaulting your payments, and getting debt is always bad.
Always Try to Clear Your Debt
Personally, I would find an additional source of income to be able to pay for my debt. It’s hard to reduce expenses, especially if the expenses are for our fundamental needs to live. There are a lot of ways to earn extra income, and sometimes there are some ways that do not require money. For instance, having a garage sale at home, selling your used items, or clothing at home or online. You may also try to buy and sell, or take freelance projects to earn additional income. During these times when people have been pushed online more and more there are many new websites to do online work.
You Can be Debt Free
Unless the bank gives you a loan with zero percent interest for life, the average person should really avoid getting in debt. I don’t subscribe to the idea that you get a loan to pay for the first loan. It’s like the second credit card is paying for the first one. This will only bring you deeper in debt, you would have to get debt relief just to stop you from getting deeper in debt. It doesn’t make any sense to pay your debt with debt. The important thing here is to generate or allot a certain amount to pay for your debt every month until it is paid off. Nothing feels more comforting and peaceful when all your debts are settled. I know being debt free is possible and you can be debt free, too. I know people who were in debt before and now they are debt free. Believe that it can be done, work with experts as needed, and you will achieve it,