When you spend more than you earn, a lot of things happen. You end up getting short on cash and borrowing to pay for your debt, which starts small, as they always do. Then you overspend again, which means you need to borrow more to make ends meet. This becomes a debt spiral that is hard to escape without discipline and the right mindset.
Let these help you get out smartly:
It’s Okay to Borrow to Pay Bigger Debt
There will be a lot of people warning you not to borrow more to pay your debt, as that is what caused the spiral in the first place. However, if there are loans that offer a smaller interest rate, and if it will clear a debt that has a potential to balloon even bigger when left unpaid, go ahead and borrow. Cash and title loans are available from Utah Money Center in Provo to help you clear bigger debt and manage the remaining smaller ones.
Use Savings Instead of More Credit
The idea is to minimize your debt, and accruing more credit is not the way to do that. If you’ve got some savings stashed away, it is acceptable to use them to clear everything. You’ll feel better starting to save again once there is no outstanding debt attached to your name. This is where it’s smart to use your credit cards.
Pay and Clear
Paying your credit card debt should not be just about freeing up funds so you can use them up again. Develop a better spending habit by purchasing in cash, so you will only buy those you can afford right now. If you have multiple cards, pay their balance one after the other, then cut the card. You can also transfer your balance to another bank, so you do not have several interest rates making payment more expensive.
The debt spiral is a dark place to be. Though you may think there’s no escape, if you start tackling debt wisely, you can make your way out.