It is not always true that you need a professional to get you out of the financial crunch. You can also do it effectively all by yourself with just a little bit of strategic planning and self-discipline. The first step that you must take when you want to take control of your deteriorating financial status is to develop a budget. It will give you a realistic idea of how much money you earn and how much you spend on your daily living expenses. You will also get an idea of all the expenses which you can easily do without and save a considerable amount of money to create a corpus.
Preparing The Budget
To start with you must make a list of your income from all the sources including, rents, and part-time jobs apart from your salary. After that list the fixed expenses which remains same every month like car payments, insurance premiums and others.Also list the varied expenses like groceries, utility bills and others. This will help you to prioritize your expenses, track your expense pattern and find out the essential fields. Keep the basics like food, health, education and identify the lesser important ones. You can take help of free budgeting software available in the market to create an effective budget, balance your checkbook, make plans, save money and pay off your debts.
Contact Your Creditors
You must contact the creditors as soon as you face any trouble in making your both ends meet and come up with the payment on time. Tell them about your financial condition and the reason for your inability to pay on time and the hardship that you are facing currently. It can help you to ask for some rebates, extended date of payment without any extra or penal charges. Sometimes they can come with a payment plan which can be modified according to your affordability. That will reduce it to a more manageable level and you can also avoid the credit calls.
Managing Auto Loans
When you have an auto loan and fall behind with the payment, the agreement about automobile financing can allow your creditor to repossess the car any time and from anywhere. There is requirement for any notice to be served beforehand. When you come to know that your car has been repossessed in order to get it back you have to pay back the whole outstanding amount till date including the storage and towing expense or else your creditor can sell it off. You can avoid such a situation by selling off the car yourself and paying off the debt and this way save the repossession cost and a negative entry in the credit report.
Manage Other Loans
For unsecured loans like credit card and personal debts you can choose loan consolidation, refinancing and much more. You can click here to know more about loan consolidation and refinancing process, tips and workings. If you default in a mortgage loan then you can talk to the lender and ask them not to forecloseand suspend payments for some time till you get out of the dire situation.