How to Effectively Manage Your Debt

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We believe that people should be free to live the lives that they want. Whether it’s traveling all over the world to living a life that’s financially free, the choice should always be theirs.

However, life doesn’t always work the way we want it to. Sometimes unexpected expenses or the many vagaries of life may lead to us accumulating excess amounts of debt.

Debt which can be difficult or even impossible to pay off. Sad to say, for many people this is a real fact of life and consequently, honest, hardworking folk typically end up becoming enslaved by debt.

Fortunately, there are plenty of ways for one to rid themselves of this. In this article, we examine how anyone can live a debt free life and achieve financial freedom.

1. Consolidate debt

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As we’ve spoken about before, consolidating all your outstanding debt is one of the easiest and most effective ways of managing it.

To get started, you’ll need to make a list of everything that you owe. From bank loans to credit cards, you’ll want to know how much is owed and to whom.

This allows you to first prioritize your payments and then develop a repayment schedule.

If you have the option, consolidate all outstanding debts to a single card. This makes it much easier to control your spending patterns and affords better control of everything.

Additionally, if you’ve racked up lots of credit card debts, you should consider consolidating all of your debt onto a single card. Preferably a card that offers you zero percent interest on credit transfers.

Besides letting you save on interest owed, credit transfers give you a grace period of several months to get ahead of your debt. With the frankly extortionate rates charged by banks, several months of interest free repayment is definitely a welcome respite.

2. Start paying off debt

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As unwelcome as a proposition it maybe, sometimes facing your problems head is the only way to get anything done.

Being faced with a mountain of debt can be overwhelming at first. But always remember: if there’s a will, there will always be a way.

Instead of tossing and turning every night fretting over your debt, grab it by the horns and start by paying off your debt.

While banks may give you the option of paying only the minimum amount, this should only be a last resort. Instead, always make more than the minimum amount owed.

This speed up your repayment and also has the benefit of helping you pay less interest. Banks and credit card companies typically favors clients who make only minimum payments.

This is because they stand to make more of you from interest payments. While it may be difficult at first, before long you’ll realize that you’re living debt free again.

3. Establish alternative streams of income

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The easiest and most effective way to beat debt is to earn more. With more money, you will be able to pay off more debt at a faster rate.

Easier said than done right?

Well maybe not given the opportunities available to so many of us nowadays.

For those of you with a marketable skill such as writing, graphic design or even accounting or coding there’s a market hungry for freelance talent.

Sites such as Upwork or Fiverr have made it exceptionally easy for anyone to get started. As an added bonus, if you’ve got a real knack for it, freelance work can even be a full-time business.

Got a knack for games of chance?

Why not earn a tidy sum wagering on sporting events like the Kentucky Derby. With a low barrier for entry, all you’ll need is a little luck and skill to earn the big bucks.

However, always remember to know your limits and manage your risks where possible.

By staying track and remaining disciplined, you’ll have no trouble living a debt-free life. With some extra luck, you can even make a ton of money.