Once a borrower has gone beyond the limits where it seems too difficult to handle all of the payments due, Some people will file bankruptcy or some do the more bigger mistake by trying to avoid the collection calls or bills, or sometimes will get panic of collections or bills and will decide something without taking it to the right solution.
On other hand some people will go to consolidating institutions which would make them more in mud.
The borrower is always in a very sensitive situation like quicksand where each try to get out of it pushes more inside.
SOLUTION:
First of all, you should know the facts and figures, So, make a kind of table on the paper that would be easy to read or easy understand and then write or type down your income and then start with expenses on the other column.
There are different natures of expenses at any household that include fixed, variable, uninvited, hobbies, extras and emergency
Expenses more than the income is deficit,
Income more than Expenses is savings or surplus.
In both cases you need to take important decisions step by step to set yourself free from the state of continous deficit that keeps going higher and higher by the each month passes.
Here I have to add some of the quotes:
"Money saved means money earned"
"time is money and knowledge is power"
"While fighting, if you are the one who is been beaten then you have to be defensive intead of offensive"
"Rent should not be more than 1/3rd of the total income"
GOOD LUCK
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4 comments:
wonderful work of educating the more lucky people, who have not fallen in this trap already. I myself am earning for the banks only
I remember in Pakistan at some stores if I gave my credit card, they used to see me with strange looks. But in Canada, one misses out on a lot of opportunities if he/she doesnot have a credit card. I want to say that the problem is not in keeping credit cards. I think the problem is also in our handling of the cards.
But yes, if u r in the quicksand of debt, Pakistan offers no consolidation:( only an option to switch to a deeper one if at all;)
very good insight and valuable suggestions. I wud also like to add here that frequent credit card usage is a short cut to a short-term solution which leads to a very long way to repay that money in a long run.
Somewhere I heard that if u buy $100 worth of things using a credit card, and u r used to paying the minimum payment required only then its $500 u repay for that $100. So before making a purchase one shud think, is it really worth it???
nothing to hate about credit cards except Interest Rate, the APR and the OCL fees which is why I dislike it. If it didn't have any impact on credit rating I wouldn't have it.
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