The current pandemic has affected our lives in many ways. It’s not just about health and safety now, other issues such as unemployment and falling economy are creating a significant impact too. According to surveys, four out of every ten households are facing financial crises in America, and unemployment is making them all the more desperate.
In such a situation, sharply rising debt rates have been observed. Several people are borrowing money to stay afloat. While that’s okay, the problem is that most of them have no idea how to manage their debts or plan about repaying them.
Are you facing a similar challenge? Well, we have a few tips that will help you with your financial crunch and make you a pro in managing debts.
TIP ONE: CONTACT THE COMPANY
Stopping repayment isn’t an option. You should rather contact your lender and ask them for deferred payment time. There are high chances that they’ll allow. In fact, some companies are even suspending interest charges for the time being. Make use of this.
According to a survey, 91 percent of consumers who asked their lenders to cut down the interest got it done. So, look out for better options and make sure you have your agreement in writing.
TIP TWO: GET A BALANCE TRANSFER CARD
Heard about balance transfer cards? If not, get to know about them from your financial advisor. They offer almost 12 or 15-month interest-free loans; some even for longer periods. This can help you in relieving your financial pressure temporarily. But there’s something you need to know – to avail a balance transfer card you should meet a set criteria provided by the company.
TIP THREE: EMERGENCY FUND OR MONTHLY PAYMENT?
What do you think is more important, paying a credit card bill or keeping an emergency fund for at least six months? We suggest the latter. While both are significant, it’s critical for you to maintain emergency funds rather than paying credit card bills.
TIP FOUR: FIND ALTERNATIVES
Stop using credit cards to pay your mortgage, medicinal expenses, student loans, or taxes. There are millions of other ways to pay loans instead of using your credit card for them.
TIP FIVE: STAY AWAY FROM RISK
No matter how careful you get while using a credit card, there will always be some risk attached. What if you can’t use them when you need them the most? Like in emergencies! Did you know your cards can be seized without any valid notification? So why take the chance? There are better alternatives to credit cards for emergencies. Why not use those?
The current situation might be depressing, but it won’t last forever. Be patient and consult a financial expert to get out of debt quickly. Apart from this, you can take the above-stated steps to relieve your financial burden.