Anonymous
Anonymous asked in Business & FinancePersonal Finance · 1 month ago

Need help getting out of debt?

14000 credit card

17000 car

1800 personal loan

6000 personal loan.

After all my expenses are paid i have about 3000 left over to spend. Problem is, i have bad spending habits. I only just recently acquired a significant income and ive been feeling deprived the last 2 years and depressed and so instead of paying the extra money i get towards my debt ive been spending it and having a ball the last 2 months and im afraid im going to keep doing it and i need to stop. Any advice? 

3 Answers

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  • 1 month ago
    Favourite answer

    Step 1: STOP spending more that you earn.

    Step 2: Pay the minimum on all but one debt, and pay as much as possible on that debt.

    Step 3: When the first debt is paid off, concentrate on the next.

    There are 2 schools of thought about which loan to pay off first.

    1. Mathematically, paying the debt with the highest interest rate first will reduce your debt fastest.

    2. From a behavior modification perspective, paying off the lowest balance first earns the psychological reward of eliminating a debt sooner. The theory is this motivates you to stick with the effort.

    Setting up automatic payments from your bank account as soon as your income is received can help control spending. Another incentive not to spend is ONLY paying CASH for anything other than bills, and only carrying what you NEED before you will be home. If you CAN'T buy anything without stopping at home for funds, it is far easier to not spend on things you don't need.

    Source(s): NEED
  • Anonymous
    1 month ago

    Use some of the left over money to pay for psychiatrist/psychologist sessions to help with your depression & bad spending habit. Then, use the rest of the money to start paying off debts. 

  • Ian
    Lv 4
    1 month ago

    I wasn't in as deep as you but had a problem of overspending while dealing with debt just the same. I had to really exercise self control and just stop the free spending spree. Takes a lot of discipline but more than anything else I was just tired of my living circumstances and focused on that. 

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