Back to Basics ….. With Personal Finances

— Written By N.C. Cooperative Extension image

The present economic times are unlike what most of us have seen in our lifetime. Everyday we hear about individuals losing their job and hence their financial security. Debt management may be something that your family has never had to deal with in the past but present conditions have now made it necessary.  Debt management involves developing one or more strategies to help a debtor get their debt under control. Below are some ideas to get you started.

Should you shop for a lower interest rate on your debt?

This can be a good option, if it substantially reduces your monthly payments and the refinancing is not too costly. Inquire whether other higher debt can be rolled into the lower cost loan.

What if you can’t pay your bills?

·         Prioritize your debt. The most critical need and number one on your priorities is to keep a roof over your head. Keeping up car payments may be number two on the list to pay if transportation is necessary for your job.

·         Maintain payments to as many creditors as possible.

·         If it is necessary to make a late payment or miss a payment, contact the creditor as soon as possible to work out a plan for getting back on track.

·         If credit counseling is necessary, use a reputable credit counseling service. In our area, On Track may be able assist you.

Use your credit

·         Access to credit may be helpful in tight times, allowing you to manage unforeseen expenses such as emergency home or car repair. Just be sure to evaluate how using credit now will affect your budget in the future.

·         With a good credit history, you may be able to work with existing lenders to lower your interested rate and negotiate terms for existing loans.

·         When you receive gifts of money, get a bonus or pay off a debt, use the extra money to pay down on your remaining debt.

For additional information on getting through tough financial times contact the Buncombe County Cooperative Extension Center.

Source: Financial Crisis Issues Community