Credits

Thursday, September 21, 2017

Debt: The Biggest Problems You'll Face

(Image:http://bit.ly/2xifmWW)

Just hearing the word debt is enough to get most people nervously clutching their purses and double-checking their bank balance. It’s something none of us ever want to be in and is one of the worst financial positions you can fall into.

No one likes the idea of debt as it pushes them closer towards to b-word bankruptcy. It’s everyone’s greatest fear that they take on too much debt, can’t pay it all back, lose all their money, all their assets, and end up bankrupt with nothing.

Alongside this, being in debt is just a very bad experience as well. There are lots of aspects of being in debt that are really hard, which is why it’s difficult to get out of the situation. In this article, I’ll talk to you about some of the hardest things about being in debt.

Having Too Many Payments To Make

Loads of people end up in debt to various people or organizations. They could have student debt, credit card debt, and be in debt to another lender too. When you’re fighting multiple debt battles, it’s very hard to keep up with all the payments. As it mentions on debtconsolidation.loans the best solution to this is getting a loan to consolidate all your debts. This is one big fat loan that pays off all your individual debts and moves them into one debt that you can pay off over time in a more manageable fashion.

Owing More And More

A huge problem with debt is that you start to owe more and more the longer you’re in it. This is largely down to interest rates. The longer it takes for you to pay off your debts, the higher the interest rates can rise for your particular debt. As such, your debt continues to grow, which makes it even harder to pay off. It means you take longer and longer to pay it off, which means the interest can grow even higher!! As you can see, it’s a bad cycle to fall into.

Losing Your Assets

At the extreme end of the scale, we have people that are in so much debt they lose some of their assets. If you got a secured loan, and you’re struggling to pay it back, the lender can take whatever it was you used to secure the loan in the first place. This could be your house, car, etc. I wrote about secured loans vs. unsecured loans here prettysinglemom.com/2016/04/ if you want to check it out. Obviously, being in a position where your personal belongings are taken away from you is not great at all, and incredibly stressful.

Don’t let debt rear its ugly head at you and tear through your finances. Be smart whenever you’re borrowing money for whatever reason. Always ensure you can pay back what you borrow, and avoid borrowing unless it’s absolutely essential. There are times in life where you’ll have to get a loan and owe someone money - buying a house and getting a mortgage is a good example. But, if borrow for no reason, this is when you start owing lots of people lots of money and can end up in serious debt.

No comments: