13 May Avoid These Common Debt Mistakes

Seeking debt relief is a clear indication that you are ready to take control of your financial issues. Realising you can change simple daily habits and bigger picture planning is a good first step in establishing financial goals. While debt counselling is a structured solution for over-indebted consumers, you should avoid these common debt relief mistakes to stay on track.

Not Budgeting Properly

It might seem like a simple thing, but creating and sticking to a monthly budget can massively impact how you create debt, spend money, and save. For your monthly budget to be realistic, you should accurately break down your total monthly income and all expenses, big and small. A detailed budget can reveal spending habits that should be revised, and can also help you track your progress as you work to repay all your debts.

Accumulating Further Debt

Achieving a debt-free existence requires commitment and consistency. It is counterproductive to take on more debt if you are trying to resolve your current debts. As professionals in debt review, we advise our clients to avoid these common debt relief mistakes to improve their finances. Prioritise repaying your debt without making it harder on yourself – if you need or want something that isn’t affordable right away, consider saving up for it instead.

Making Minimum Payments

Take note of the additional efforts you can make to overcome your debts more quickly. Did you know that, by paying more than the minimum monthly payments, you can save on interest and repay the debt faster? Debts with high interest rates should be paid off quickly if possible. Make a list of your debt responsibilities, and aim to repay them more effectively, if your budget allows. It will make a difference in the long run!

Not Seeking Help

There are effective debt relief services available to individuals who need help. While dealing with an irritating monthly debt repayment is one thing, numerous debts on a tight budget can quickly spiral out of control. You can consult with one of our Debt Counsellors for professional insight and useful guidance. We provide a debt counselling service tailored to your financial circumstances, for the best chance of debt relief without negative impacts on your credit report.

No Emergency Fund

Access to emergency funds can help you avoid further debt, improve long-term financial stability, and reduce stress. There are many benefits to having an emergency savings fund, even if it takes a while to set aside a substantial amount. Contributions to your emergency fund can add up quickly, especially if you have a low-interest or interest-free savings account. Start small, allocate more when you can, set up an automated transfer each month, and be persistent.

At Limdebt, we provide South Africans with a comprehensive and result-driven Debt Counselling service. Contact us today to get started!