Dealing With Personal Debt.

We can all use a little peace of mind. One way to achieve it and financial stability is to get control of your household finances and debt. There are ways to get out of debt and stay out of debt.

A good start to getting control of your spending and debt is to track where your money goes. List your long-term debts to include all of your loans such as your student loans, mortgage, and car loans. After that write down your monthly commitments such as utilities, internet, insurance premiums, credit card bills, etc. Beginning on the first of any given month make note of absolutely all of your expenditures during that month.

When the month is over, determine which is higher, your spending or your income. If your spending is higher, that is the amount of debt you are incurring. Review your expenses and determine which ones you can reduce and debts that you can set a schedule for paying off. There are numerous ways to track your expenses from a handwritten list to spreadsheets or apps.

There are many habits we have that can really add up. Those coffee runs and lunches out get expensive. Smoking, drinking, and gambling can be very costly though challenging to stop or reduce.

Credit cards can make it a little too easy to spend money. Pay for all discretionary spending with cash, people spend less when using cash than credit cards.

When budgeting, use the 50-20-30 rule. Spend 50% of your income on the essentials such as mortgage or rent, utilities, groceries, childcare, loan payments, and transportation for work. 20% of your income should go to financial goals such as savings and debt reduction payments. Finally, 30% should go towards flexible spending. Flexible spending is discretionary spending like travel and entertainment.

It is very helpful to set financial goals. It is very motivating and can make you stronger financially. Have specific goals, both long term and short term. Goals can include saving a certain amount to be able to buy a car or home. You might set goals to pay off an individual debt by a specific date.

If you are having a hard time paying your mortgage or rent you may want to bring down your housing expenses. You may be able to refinance your home and get a lower rate and/or extend the repayment period. If you are renting it may be time to look for a more affordable apartment.

Hopefully, some of the suggestions above will help you control your debt now and for the future. If you need more assistance and your debt is not manageable you may want to consider filing for bankruptcy, for a fresh start. Consult with Shoffner & Associates, experts in bankruptcy, to find the best option for you and your circumstances.

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Freya Allen Shoffner, Esq.
Shoffner & Associates
Counselors to Small Business and Families.

Give Freya a call at (617) 369-0111 TEXT US (413) 207-6219 or email

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