In many parts of the world consumer debt has climbed to an all new high. With the exception of mortgage debt, statistics show that the average household in the US alone is in excess of $12,000.
Whether you have alot of debt or a little it is a great idea to pay out what you owe as quickly as possible. Paying out your financial obligations is not always related to how much money you earn. There are lots of you who may be fortunate enough to have high incomes and are still unable to clear out your debts – what really makes the difference is your money management skills.
Each of you will have varying reasons as to why you went into debt in the first place. Some of you have been frivolous with your spending, maybe you wanted to buy items such as a new outfit, a brand new car even though you have a good working car, a trip to a cozy resort, all of this to show the world you are doing better than your neighbors.
Then there is another group of you who have become in debt due to financial hardship such as:
- unexpected loss of work
- medical concerns
- unexpected events for which you have no control over
There are many strategies you can work with to get out of debt but wouldn’t it have been best to avoid debt in the first place. The good news is there are some excellent ways to prevent debt. In our next post Part 2 we will look at preventing debt based on the two different ways the debt was incurred. See you in Part 2.