{"id":575,"date":"2018-10-08T06:12:07","date_gmt":"2018-10-08T06:12:07","guid":{"rendered":"http:\/\/www.development-work.com\/mydebt\/?p=575"},"modified":"2020-10-27T06:17:48","modified_gmt":"2020-10-27T06:17:48","slug":"exploring-the-ways-to-escape-debt-on-a-low-income","status":"publish","type":"post","link":"https:\/\/www.mydebtacademy.com\/credit-counseling\/exploring-the-ways-to-escape-debt-on-a-low-income\/","title":{"rendered":"Exploring The Ways To Escape Debt On A Low Income"},"content":{"rendered":"

The situation that narrates the story of most of us is that we want to get out of debt but our hands are tightly tied by our limited income. So, how can we possibly overcome debt once and for all? Let\u2019s take a look at some helpful advice.<\/span><\/p>\n

When it comes to getting out of debt, it is hard enough when there is a decent amount of money coming in, let alone facing this challenge when you\u2019re short on income.<\/span><\/p>\n

But, it is definitely possible to get rid of debt on a low income. But wait: here\u2019s one more twist! It\u2019s also achievable without selling key assets, such as the house or car you don\u2019t yet have.<\/span><\/p>\n

Today, we are going to cover the strategies which you can use to be successful this major feat.<\/span><\/p>\n


\n<\/u><\/em><\/strong>Table of Contents<\/u><\/em><\/span><\/h3>\n

The starting point of any debt solution is to conduct an analysis of your financial circumstances<\/em><\/span><\/p>\n

Secondly, you can create a budget with the help of zero-sum budgeting techniques<\/em><\/span><\/p>\n

Take a deep hard look at your prime expenses to see where you can shake off some extra fat<\/em><\/span><\/p>\n

One and the only way to pay off your debt is to pay more than the minimum payments<\/em><\/span><\/p>\n

The optimum way to approach debt is to handle one balance at a time<\/em><\/span><\/p>\n

Keep a constant touch with your creditors all the way through the process<\/em><\/span><\/p>\n

Considering the cash first will assist you in reducing your spending<\/em><\/span><\/p>\n

More than one income source can be helpful in paying debts faster<\/em><\/span><\/p>\n

Last but not the least, know what debt solutions should be preferred<\/em><\/span><\/p>\n

Summing up<\/em><\/span><\/p>\n

The starting point of any debt solution is to conduct an analysis of your financial circumstances<\/span><\/h3>\n

It\u2019s impossible to eradicate the debt which you are unaware of,\u00a0simply because one of the most vital elements of any effective debt-reduction strategy is deciding which debt to handle at priority. Use a computer or be old school by using an old-school paper spreadsheet if that\u2019s what you want\u2014and note down every debt you have.<\/span><\/p>\n

Make sure to list the outstanding amount, the applied interest rate, the tenure, monthly payments, and the available credit limit for every debt. This will enable you to go deep when it comes to understanding the complete situation, and offer you confirmed numbers to work with when you go for making a budget (spoiler alert).<\/span><\/p>\n

And while you\u2019re at it, create separate spreadsheets to record all of your other monthly expenses, such as utilities, food, car payments, etc. Plus, one for all the money that you are hoping for in from various sources.<\/span><\/p>\n


\nSecondly, you can create a budget with the help of zero-sum budgeting techniques<\/span><\/h3>\n

Nobody likes making a budget. But believe it or not, it is the only way you can keep your debt under control.<\/span><\/p>\n

Once you are familiar with all your expenses and debts, you can follow the process of allocating your monthly income as required. According to the financial experts, once you buried under a mountain of debt, using zero-sum budgeting method can be a perfect solution.<\/span><\/p>\n

This budgeting technique offers you the right tools to enhance your finances by guiding you how to:<\/span><\/p>\n

\u00a0 \u00a0 \u00a0 1.\u00a0<\/strong>Live off previous month\u2019s genuine income rather than conducting income projections.<\/span><\/p>\n

\u00a0 \u00a0 \u00a0 2.\u00a0<\/strong>Take actionable decisions when it comes to your money.<\/span><\/p>\n

\u00a0 \u00a0 \u00a0 3.\u00a0<\/strong>Trim down waste.<\/span><\/p>\n

The actual idea behind zero-sum budgeting is that every month, you don\u2019t have a dollar left with you because every cent has been assigned to debts, bills, and savings. This might sound a bit unsettling, but it is the fastest way to regain control over your money.<\/span><\/p>\n

When creating a budget, there are a few things that should be considered first, including savings and debts. After that, the left-over can be used for everything else. If you need to cut expenses somewhere, it can be done from things such as leisure and transportation rather than debt-reduction or investments.<\/span><\/p>\n

Take a deep hard look at your prime expenses to see where you can shake off some extra fat<\/span><\/p>\n

Once your situation regarding your debts, expenses, and budget is clear, you must take actions to seal the purse strings. You can\u2019t beat down debt if your debt keeps rising. Because you can\u2019t take out that money from your debt payments or savings, it\u2019ll have to be from somewhere else.<\/span><\/p>\n

Go over your budget and also categorize your spending to see where you\u2019re losing too much money\u2014on weekend movies or dining out, for instance. Then prepare a plan for the expenses reduction. Here are some ideas:<\/span><\/p>\n