Balancing Lives and Checkbooks
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Life after debt – Set yourself up for success
How likely are you to get back into debt after completing a debt consolidation plan?
Although debt consolidation can help you repay your debt, it’s up to you to determine that your life after debt remains debt free.
When you enroll in the CDS Life Coaching Total Care Service, we provide you with online tools including a spending plan Tracker to help you keep track of your daily transactions. It helps you create and manage a spending plan to insure your success.
Successful Life After Debt Tip #1 – If you haven’t changed your spending habits, you could find yourself in need of debt consolidation once again.
You are advised against taking on new credit card debt while you are participating in a debt consolidation program. Be cautious about taking on new debt after your program has ended. Many people swear off credit card debt completely after the program but it’s unrealistic to expect that you will never use credit or debt again in your lifetime. It’s a better idea to use credit wisely than to think you will be able to stay away from it altogether.
Successful Life After Debt Tip #2 – Always make your payments on time.
After you have built a three- to five-year positive payment history through debt consolidation, you don’t want to jeopardize it with a single late payment. Get in the habit of paying your credit card bills well before the due dates to ensure your payment is processed in a timely manner. On time payments will help you maintain your interest rate, reduce the cost of carrying credit and improve your credit.
Successful Life After Debt Tip #3 – Start an emergency fund to avoid debt caused by financial emergencies
That way, you have some savings to fall back on in case of a financial emergency. Continue to maintain your emergency fund after you have completed debt consolidation and avoid dipping into it unless it’s truly an emergency.
The most important thing to remember when you are making new credit card charges and applying for loans is that you should never take on more than you can afford to repay. That means if you can only afford to pay back a $10 credit card balance at the end of the month, then you should only charge $10 on your credit card. Before you swipe your credit card, assess whether you will have enough money to pay back the balance.
Successful Life After Debt Tip #4 – Focus on managing your money wisely
The smarter you are with your money, the less likely it is that you will resort to credit cards and debt to maintain your life. Good money management starts with a spending plan. Having a spending plan helps guide your spending and allows you to recognize any gaps between your income and your expenses. Seeing your expenses on paper makes it easier to evaluate your expenses and reduce them if necessary.
Successful Life After Debt Tip #5 – Staying out of debt will take much self-discipline.
Don’t be afraid to close your credit card accounts if you are tempted to use them to charge more than you can afford. Although the debt consolidation company would love to have you back as a customer, it is in your best interest to stay out of debt.
