Create Your Own Debt Elimination Plan
The ability to borrow is so important. Loans allow us get things we need today, even if we can’t pay for them right away. A home, car, or education are examples of purchases that may be impossible without credit. But once you have the loan, it doesn’t have to last forever! Here’s a simple three-step approach to paying off your debts.
Have a plan. “Budget” is not a dirty word. A budget is nothing more than your own personal plan to identify and achieve what you want. Before you start making a list of income and expenses, ask yourself, “What do I want to accomplish with my money?” As Stephen R. Covey suggests, we should begin with the end in mind. When you know why you’re doing it, creating and sticking to a budget is easier.
Your plan should include things like saving for the future and paying off debt (more on both of those in a moment). It should also address your needs, like housing, utilities, taxes, etc. But what about your wants? Things like date night, getting nails done, or attending a concert? If those are important to you, they have a place in your plan!
Remember, this is your plan. Don’t make it so rigid that you can’t do the things that you love to do – within reason, of course. If you hate it, change it! Just don’t blame anyone else for the results.
Click here to learn more about budgeting, including a personalized coach to walk you through the process.
Save for the future. Even before you start tackling your existing debt, it’s prudent to begin building a small savings account to prepare for future emergencies. Don’t stop making at least the minimum payment on your loans, but start setting aside a little money each month in a savings account.
Our Save to Win savings account is a great way to help you save, have fun doing it, and possibly even win cash prizes in the process. Visit www.freedomcu.com/SaveToWin to learn more about this unique account.
Click here for resources to help with savings basics, or click here for information about planning for retirement.
Pay off debt. Once you have a plan and are saving something each month, let’s make a plan to pay off your debt. Our free Debt Coach is a great place to start with advice, calculators and tools customized to your circumstances. We may also be able to help with a consolidation loan, potentially saving you money on interest charges.
Have questions? Please give us a call or come to our office. We’re here to help you.
Ready to apply for a consolidation loan? Click here.