Well, it maybe not so sudden but millions of people are suffering from the debt accumulated such as student loans, credit cards, and mortgages. Though there are some who must deal with a certain unfortunate and sudden situation that puts them in sudden debt such as medical emergencies or loss of job/income. It can be hard to deal with debt that comes up unexpectedly. Let's try to lighten the debt load with these five steps:
Step 1: List All Debts in Detail
List all of the debts that you have in detail. That means listing out things such as:
- Amount owed
- Due date
- Interest rate
- Creditor’s information
- Monthly payment
Doing this may overwhelm some but it is the only way to get realistic and take action.
Step 2: Assess a Game Plan
Once you see the debt in front of you, you can figure out what to do. Options may include things like:
- Debt consolidation
- negotiating for lower payments/ interest rates
- balance transfer
- asking for delays or postponements
- pay off ones with higher interest rates
- Ways to cut spending
Step 3: Talk to a Financial Counselor and Get Educated
If you feel swamped by the sheer amount, talk to a financial counselor about your situation.
A good, ethical counselor will be able to steer you on the right path. They will be able to teach you how your new debt will affect your other debt, but will also be able to teach you how it will affect your overall financial situation.
Even better would be to educate yourself AND get a counselor. Financial education is key to managing, and getting out of debt and most importantly staying out of it once you're there. Having knowledge is power, so keep reading and learning.
Step 4: Talk with Family
One of the first things that you need to do when coping with debt that is unforeseen is to talk with your family. This especially includes your significant other as they may offer ways to help. And of course it becomes their headache as well so it’s best to tell the truth than hide things.
Step 5: Stay Strong
It is important for you to stay strong as you go through these other steps. Do not be discouraged but be motivated to make more money and realize that with that extra motivation and focus, you can overcome debt, even when it is sudden and unexpected.
There are millions of stories who come out of the hole and able to live a debt free life.
You will be one of them.