If you find yourself in a position of overwhelming debt that you need to get on top of, the best thing you can do is get started. No matter what our circumstances, there are many reasons you may find yourself in a position of debt. This leaves you wondering, how can I manage debt?
It doesn’t make you a bad borrower or indicate that you don’t know how to manage your finances. Sometimes, unexpected expenses can crop up that haven’t been budgeted for, leaving you struggling to pay it off. This is where debt management comes into play. We take a look at what is debt management and how to get started.
How can I manage debt?
Are you wondering exactly what is debt management? It is simply a strategy you can put in place to help manage your debts and to put you back in control of your finances. It’s no secret that debt can creep up on us, with unexpected expenses tipping us over the edge. These can’t be planned for and can push us into spiralling debt.
Thankfully, there are plenty of options available when it comes to debt management, so you can find a strategy that suits your individual circumstances to help you get back on top of it. It’s an agreement you enter into with your creditors to manage the repayment of your debts. You can negotiate the terms with your creditors to come with a plan that you can successfully manage to pay back your debts.
There is no simple answer to “how can I manage debt”, however debt management is your best place to begin. Debt management can help you get on top of your finances by getting the help you need to see yourself out of debt on terms you can meet. It is about taking back control of your debts and making your life much easier in the process.
With a debt management plan you can:
- Reduce interest rates
- Waive late fees
- Lower monthly payments
What Is a Debt Management Plan?
If you are worried about your own accumulating debt, then a debt management plan could be just what you need. What is debt management? It’s about coming to an agreement with your creditors to reach an affordable solution to your financial needs.
Of course, this isn’t always easy to do. Often, a third party is brought in to negotiate with your creditors on your behalf to help. Their goal is to bridge the gap between you and your lender to find a solution that works for both parties.
How can I manage debt? With a debt management plan in place, you will have a new repayment schedule with your creditors that will be more manageable with your financial situation.
A debt management plan is often the last step before going into a Debt Agreement or declaring bankruptcy. A Debt Agreement is a legally binding agreement between you and your creditors, which if not fulfilled, can lead to bankruptcy. If you can settle your debts with a debt management plan, it is the best solution to help you in the long run.
How To Set Up A Debt Management Plan?
Now you know how can I manage debt, it’s time to learn how to set up a debt management plan.
- The first step is to take a look at your own financial situation. What is your income and what are your expenses? Set out a thorough budget that outlines all these details.
- Next, put together a list of all the lenders you owe money to, how much you owe and the interest rate.
- Now is your chance to work out what you can afford to pay to each lender each month. You may want to start with the debts with the highest interest and just pay them or pay an equal amount to all your debts.
- Once you make a decision, contact your creditors to explain your situation and the help you are looking for. Propose a plan to help you repay your debts.
- If your creditor agrees, then you can start making repayments according to those plans. If your creditor doesn’t agree, it might be time to bring in a third party that can negotiate for you to get the best deal possible.
Getting The Help You Need
Finding yourself in a position of debt that you are unable to repay isn’t an ideal circumstance for anybody. Thankfully, there are options out there to help. If you are wanting to set up a debt management plan, then speak to the experts at The Australian Lending Centre today.
We can look at your individual circumstances and help put a repayment plan in place that you can afford. We will then act on your behalf to negotiate with your creditors to get the best deal possible. It’s the first step to getting yourself out of debt and in a better financial space. If you need help, pick up the phone and give us a call today.