Earlier this year, it was reported that Americans under the age of 35 carry an average household debt of $67,400. With age, this number only gets worse. In fact, those between the ages of 45-54 are said to have an average of $134,600 in debt (including their mortgage). Looking at the financial health of Americans holistically, 80% of individuals have some kind of debt. For most people, balancing finances is a challenge.
There is also an increasing number of individuals who have found themselves in significant financial hardship due to debt. A 2018 report showed that “about 30 million people in the United States have at least one debt in collections.” Additionally, according to The Wall Street Journal, 4.6 million student loans were in default in 2017. If you have found yourself in a similar situation to the ones described above, know that there is a way to relieve your financial stress. Explore proven ways to press the “reset button” on your finances immediately.
Stop unnecessary spending and create a budget right away
Experts estimate that “52% of Americans are spending more than they earn.” If you find yourself giving in to excess purchases, now is the time to stop this habit. Once you’ve stopped any unnecessary purchases, create a budget that works for you. While a budget may sound as though it will restrict your spending, it actually gives you the freedom to spend a specific amount without feeling stressed.
Work to boost your credit score
Although it may sound daunting, cleaning up your credit history is actually a lot more simple than it sounds. Recent reports have shown that “more than one in five consumers have a ‘potentially material error’ in their credit file that makes them look riskier than they are.” Therefore, the best place to start in boosting your credit score is by looking for errors. Either you can do this by requesting a full report, or you can hire one of the many companies who perform this service, such as Excel Capital Management.
Request to remove late fees
Had to make one or more payments late due to financial circumstances? Some loan and credit card companies will waive a late fee under certain circumstances. While these companies are by no means obligated to honour your request to refund a late fee, it is worth calling to see if they will. These late fees can then be put back into paying down your debt.
Explore the option of payment plans for outstanding bills
Have larger outstanding bills that need to be paid asap? If it isn’t possible to pay the full amount right away, you almost always have alternatives. Reach out to the company to which you owe money, and see if payment plans or partial payments are an option. Oftentimes, companies will be flexible in meeting your needs.
No matter how messy your financial situation is currently, there are steps you can take today to improve things right away. Although it will take some time and effort to fully resolve all of these issues, there is no better time than now to hit the “reset button” on your finances.