How to get out of debt yourself, following the rules
April 29, 2019
The most effective ways to get rid of debt forever.
The question of how to get out of debt remains relevant, especially in an era of crisis. The reasons for which you could be in debt hole, many. And not all of them depend on your behavior. For example, unexpected dismissal, salary reduction, illness, death of a close relative. And the constant rise in prices for goods and services leads to the need for permanent loans. What to do?
We look at the enemy, that is, the debts, in the face
As they say, the devil is not so bad as he is painted. Before you begin to distribute debts, you should clarify what, to whom and in what amounts you should. All data on your loans and debts, from which you need to get rid of, it is desirable to record in tabular form. It can be, for example, the following columns:
- Name of the lender.
- Base loan amount.
- Interest rate.
- Overpayment amount.
- The size of the monthly payment.
- The term when you need to repay the debt (if the loan is the date of the next payment and the total duration of the loan).
It is better to leave the last column broad, because in it you will mark all events related to the loan, for example, “Deferred is granted,” “Give urgently” or “Redeem first.” The most convenient way to make such a label is first on paper, and then transferred to Excel.
Next you need to make an analysis of the work done. In principle, when you arrange your debts, it will become clear exactly how much you pay in a month and how long this situation will continue. You will also see the most expensive loans (with a high interest rate) and loans with the largest overpayment (the rate on them may be less, but at the expense of a long loan period, the overpayment will be greater). What kind of strategy to repay loans – let’s talk later.
Compiling a calendar of payments
The next step is to create a payout calendar. You can mark the date of payment in any wall calendar or draw a special sign. The latter is convenient, since in addition to loans, it will be possible to enter into the table any other obligatory expenses — rent, for example, and also income — salary, advance payment, etc.
As a result, you will see on which days you have incomes, on which obligatory payments, how they are grouped, whether you have enough money to pay off multiple payments in one week. Now you can plan. For example, the salary is charged at the beginning of the month, to pay loans – in the middle and at the end. You can postpone the required amount in advance.
It is especially convenient to use a sign when you have a lot of payments. Then you will not get confused and will not delay the date of the next installment on forgetfulness.
We understand current debts
If, on the part of loans, the situation is so deplorable that there is nothing to pay a loan, and the amount of fines has long exceeded the payment itself, collectors spend the night at your door, and relatives refuse to allow for lunch until they pay off the debt debt with minimal losses.
The best solution would be to openly admit one’s financial insolvency and negotiate with creditors. If borrowed from friends and relatives, then you can agree on the write-off of interest and installments. If a lot of loans, you can ask the banks to postpone or refinance.
But do not relax, as soon as credit bonds weakened slightly. This is not the time to waste money. The released funds need to be allowed for early repayment of debts. For example, you have three credits of 10, 5 and 4 thousand rubles, and the net income (that is, free money) is 17 thousand. You have agreed to postpone a second loan of 5 thousand rubles for a period of six months. Your payment was not 19, but 14 thousand rubles. The released 3,000 must be set aside for the early repayment of one of the credits or deferred to a special account to form a financial cushion. But you can not spend them.
If your debt is sold to collectors or banks are charged too many fines, then it is better not to pay on these loans, but go to court. Usually, judges “write off” all kinds of penalties, especially if they are not provided for by the contract. Often it is possible to reduce the size of the monthly payment to a minimum by reducing the interest rate or increasing the term of the loan.
We make refinancing
If there are a lot of payments and the interest on them is large enough, then it is necessary to make a refinancing. There are several ways to do this:
- take part in a special program of the creditor bank;
- take part in a third-party refinancing program;
- independently take a loan at a lower percentage and pay off current debts with the funds received.
Since the borrower himself is unlikely to receive a new loan with current debts, a new loan is usually issued to relatives or a friend. It is necessary to calculate the benefit – self-refinancing is beneficial if the total loan period does not increase, and the new rate will be more than 3 points lower than the current one. In other words, if a loan is taken for 5 years at 33% per annum, and refinancing is made for the next year, then its parameters should be as follows: term – not more than 4 years, rate – not more than 30% per annum. Otherwise, you will have to pay interest again.
Of course, if the situation is critical, and the amount of monthly payments is too large, then any way to reduce the financial burden is suitable. To the extent that asking the bank to extend the loan term – the total overpayment will increase, but the monthly payment will decrease.
By the way, during refinancing you can try to postpone the date of payment. It is more convenient to pay all the loans in one day and try to receive income just in time.
It is optimal to refinance a special program. Then it will be possible to combine all the loans into one, and the overpayment will be minimal. It is much easier to get approval for the operation in “your” bank.
Draw up a plan for repayment of loans
The next step is to determine the debt repayment strategy. The most optimal are the following three schemes:
First, the largest loan is repaid , then the second largest, then the third, and so on. The method is good because monthly payments are reduced, free money is released. Disadvantage: it will take quite a long time until the first loan is paid off.
First, small debts are repaid , then the largest ones. The method is good because it is easier to “close” small loans, while the borrower himself has a growing sense of satisfaction in reducing the number of payments. Disadvantage: the final overpayment will be higher.
First, the most expensive loans are paid (i.e., with the highest interest rate), regardless of their size. This method is the most optimal, if we proceed from cost savings. Disadvantage: the most expensive loan may be the largest, and the amount of monthly payments will not fall fast enough.
All loans are repaid evenly. For example, monthly is paid on 1-2 thousand over the size of payment. Advantages: systematic reduction of payments. Disadvantage: each time you have to make an early repayment and overpay on possible commissions.
Which way is more convenient – is at the discretion of the borrower. The main thing is to develop a convenient strategy and not retreat from it.
Stop increasing debts
Taking a loan in order to repay another loan is a bad practice (unless, of course, refinancing is made). Therefore, you must immediately abandon loans and credit cards. If there are debts on “credit cards” – they need to be repaid in the first place, regardless of the size of other loans. The cards are the most unprofitable tariffs, and the overpayment on them is simply huge. It is better to get rid of debts to the bank immediately.
Of course, you need to stop paying in stores with credit cards. Only debit with the return of funds (cash-back) or, at worst, cash.
If you decide to get out of debt, you will have to learn how to save. Here are some ideas to save on:
Disable all unnecessary payments. For example, if you are not listening to the radio, then dismantle the radio. Do not pay for cable if you turn on the TV once a month. Turn off the mobile bank, if you receive a salary once a month – all the same, you will perform all operations via the Internet.
Change the tariffs to more profitable. Take time, find out, maybe there are better rates for phone, internet and cable. Sometimes it is possible to participate in special programs for the holidays.
Make a list of the required monthly expenses (all-all, up to the rent and payment of kindergarten to a child) and think about where you can save. For example, if you refuel 2,000 rubles a month, would it not be more profitable to buy a transport card for 500 rubles and use the bus? Maybe not so convenient, but cheaper. Or try to transfer the child from the paid section to the free section if the quality of his education does not suffer.
Save water and electricity , no matter how trite it may sound. Turn off excess light, electrical appliances, turn off the water when brushing your teeth. Of course, significant money cannot be saved, but even 500 rubles a month will not be superfluous – you will find how to spend it. If possible, go to a two-tariff counter and make household appliances work at night — for example, a washing machine.
Refrain from unnecessary purchases . Go to the store only with a list of products – it will save from accidental acquisitions. Plan immediately what you will be cooking during the week. Optimally, generally allocate a weekly budget “for food” and not exceed it.
Love the sales . This applies to the purchase and products, and clothing, and household goods. Get immediately more than you need – so that next time you do not overpay. But do not go beyond the budget!
Issue a card with a cashback and interest on the balance. Make a purchase only from it. It will bring the kopeck in the family budget.
As a result, if you follow all these recommendations, you can “find” in your own budget free 2-3 thousand rubles. And where to spend them – you already know.
We increase revenues
An effective way to get out of debt is to increase income.
If the savings do not give a substantial profit, then getting out of debt will only help to increase income. The main methods are as follows:
Require a salary increase. Directly – to enter the chief and ask for an increase – is unlikely. But you can take an additional number of hours, increase the load, perform more functions. In a pinch, you can get at 1.5 rates.
Find a side job. This may be the second part-time job or the night shift. You can earn money on weekends.
If the above methods are heavy or unreal, then get into freelancing. There is a lot of work on the Internet for all specialties. Services of remote authors of texts (copywriters), artists and designers, programmers, accountants are in special demand. If there are no abilities for such activity, then you can find physical work for yourself: “husband for an hour”, taxi driver, repair, etc. – there are special exchanges where similar services are offered.
Invest. Of course, money is required to generate investment returns. And if a lot of debt, then there is no free money. However, you can start small. For example, set aside 2-3 thousand per month for a deposit, and 1-2 for risk capital. It is important for you to learn the principles of investing, and not just earn.
Open your mini-business. It can be anything – a website on the Internet, an online store based on a group on the social network, reading, network marketing, baking cakes at home, sewing, burning out … Here the main thing is to start and survive the first year.
Sell extra stuff. Do you have old coins? And the stamp collection? Decorations? Maybe you have a whole bunch of clothes that you do not wear, or books that you do not read? Try to sell it – through local newspapers or websites like Avito. Received funds do not throw around, and extinguish loans ahead of schedule.
Hint to friends and relatives that the best gift is money, and that you will be happy with cash receipts more than things.
Get tax deductions. If you have taken a mortgage, then issue a property deduction or deduction on interest on the loan. In fact, you will get back 13% of all last year’s income – namely, a tax on personal income paid to the treasury. This is a lot. With a salary of 20 thousand rubles, it is about 35 thousand rubles.
Get all possible benefits and get DIA. For example, if the total family income is below the subsistence minimum for each apartment dweller, then you can receive compensation for the rent. If the family is large, it has a whole set of social support measures – from free travel for children by bus to the regional capital.
In the matter of debt repayment, the main thing is to follow the strategy that has been worked out, not to waste money and carefully keep track of finances. But this does not mean that you should not indulge yourself from time to time. Sometimes you can afford to “tax” in a restaurant or update the phone case. Just make sure that these “left” expenses are not too large, and do not go beyond the monthly budget. And, of course, spend only earned money, not credit.