Sunday , 29 January 2023

6 practical ways to get out of debt

On this edition of Citi FM and Citi TV’s Effective Living Series, a Family Finance Consultant, Charles Mensah, entreated Ghanaians to stay out of excessive debt.

According to him, it’s disastrous for people to be indebted in the economic conditions the country is faced with.

He advised Ghanaians to stop keeping up appearances to please others by buying and engaging in ‘unnecessary’ stuff which in the end have a toll on their finances.

Mr. Mensah further admonished Ghanaians to spend according to their income and not be pressured by the lifestyles of their friends, colleagues and families.

In an interview with Bernard Avle, on Citi TV and Citi FM on the topic, “Practical ways to get out of debt”, the Family Finance Consultant outlined some key practical ways to get out of debt.

List names of your creditors: Try to relax and use a red pen to list all the debts and know the amounts involved.

Check the loan payments tenure: Check from the list of your creditors the repayment schedule plan. Cross-check to see if you are either paying weekly, quarterly, monthly or yearly to avoid defaulting.

Repayment schedule: It gives you a certain amount you need to generate in your net off current expenditure [Things you consume every now and then]. Your income cannot cover your expenditure, let alone pay your debt or repayment of your principal. Don’t try to only pay your creditors who give you pressure and ignore those who don’t give you pressure.

Calling/Approaching your creditors: Make frantic efforts to call your creditors and explain your situation to them to bear with you as you make plans to pay them off.

Multiple streams of income: Engage in different jobs that will fetch you money to service your debts. You need to admit that you are broke, and you are in a crisis than cover up when in reality you are suffering.

Debt servicing: Weigh your expenditure against your income, and look for other sources of income by selling items bought years back which are not needed. Sell such stuff to service your debts. Assets such as plots of land can be sold to pay off your debts. You can later purchase these assets when you bounce back.

Put in cost-cutting measures – Change kids’ schools, and let them manage maize porridge instead of their usual cornflakes. Pack your car and join the commercial vehicles. You can make lots of savings in these areas to service your debts. Sell your products online to generate some money.

Watch the full interview below:

 

https://www.youtube.com/watch?v=/bDQAjvWMOEE

 

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