You may not believe it but our credit often depends on you. We can not without financial emergency and be able to pay our monthly installments. However, in a significant number of cases it is possible to end debt. It takes time. But it is possible.
It’s all about discipline, initiative and rigor. Nothing is done without effort. However, effort is not necessarily sacrifice. I do not mean to tell you to sacrifice your eating habits, or to stop living with quality of life. I want to tell you that it is possible to live a good life and at the same time to end your credit.
This is the way. It is not worth it to read lots and lots of books, be a financial expert or even a great speaker if you do not take action to end your credit. It is very easy to tell others how to do this or that, but it is difficult to set an example. A small step, the smallest one, will definitely make a difference and provide you with gains.
Organize Your Credits
Organizing your credit means knowing everything about them, for example, amount in debt, interest rate, term, charges and commissions, etc … Currently with the map of credit responsibilities of the Bank of Portugal it is easier to identify the various characteristics of the your credits. Draw up a small credit map and orient yourself on your current debt and the interest rates you have. If you want to send us your credit responsibility map we can make a quick financial diagnosis.
Define a Strategy
You’ve already declared war on your credits, but you do not know where to start …
I know that the best savings you can make is to settle claims that have the highest interest rate, but also, I know and I have no doubt that you need to stay motivated to do so. So choose a credit, the one that would like to get rid of it and put your hands to work …
Use Extra Money
If you were not expecting to receive any extra money this month or this year because you decide to save it or use it for other purposes. In fact you do not need it, so if you use it to pay off credits it will not get worse but better.
You may even consider that if you invest this money you will have greater profitability that you use to repay with your credits. However, by investing you will not be contributing to your credit freedom. No one needs to live on credit all their lives, because they insist on keeping credits to maturity.
Do not Use Credit Cards
Credit cards are known for the dynamic ceiling they have, allowing you to use and pay the debt you have again the ceiling to use. If you want to end your credit, you have to stop using your credit cards and focus on your goal.
In fact, it is they who have the biggest financial burden on their family budget. If, by chance, you have your credit cards out of control, then consider yourself indebted and with debt that costs you hundreds of euros per year. Avoid using your credit card or strict in using your credit card using only purchases that you think are urgent to anticipate.
Your Family Budget
We are always receiving advice on how to organize our personal finances. We like to learn new ways to save and listen to advice about personal finances, but we think they are not for us. In fact, it is not necessary to be a specialist or take everything very seriously, it is necessary to take the initiative, focus and think that 2 euros of daily savings are 60 euros per month, 720 euros per year that can be channeled to end their claims.
The way is to save money and not in the organization of your personal finances, because an organization of the family budget is not meant to save.
Pay For Your Shopping With Money
Already here I approached the value of the money sensitizing him to the importance of knowing his daily wage and to understand better the weight of his attitudes. I also think that paying your daily purchases with cash will increase your sensitivity to money because you see the transaction that moves your money from your hand to another hand.
This move will make you think before you take the initiative to buy and will help you save a few euros every day.
Selling What We Do not Need
Making money selling what you do not need was the title of an article focusing on the potential of making money by selling everything you do not need. All of these objects cost money and are worth money for not accepting to see them deteriorate in your garage or attic. Any extra money you get from the sale can be channeled to pay off your credits.
Enjoy the Discounts
They are not discounts on your credits but the discounts you have in supermarkets with the products you usually buy. Have you ever imagined that whenever you benefit from a discount for the purchase of detergent you could channel that money into your credits. For in fact, I would eventually buy the detergent even if there was no discount. So, consider putting all the discounts aside with a view to repaying the credits.
Celebrate All the Successes
Whenever you can achieve and complete each step of your strategy to end your credit, do not hesitate to celebrate. Do not be afraid to throw a party and motivate yourself to a new stage until you get the credit freedom.
You are the way and the main driver of your entire strategy. Ending credit does not depend on the bank, the economy, your financial knowledge, your ability to save, but your ability to start, take initiative and focus on the goal.
Renegotiate Your Contracts
The final point that is no less important is the renegotiation of the various credit agreements with its financial institutions. Nowadays, all contracts are subject to renegotiation. Banks want to ensure that their customers pay for their installments. In this way, they are more open to renegotiation. We will not delve into this topic in this article but we suggest reading the article “How to reduce benefits and increase your financial stability”.