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Dealing With Debt

Debt… So you wake up one day and realized you owed more than you could afford to pay within set time periods… And you have probably had to miss a few calls because every now and then that person you bought those things from keeps calling and texting. Now what?

No situation is permanent. Or at least no situation should be permanent if you do not want it to be. There are answers and solutions to work your way out of the stranglehold of debt. This will not be a quick fix, nor will it be easy, but there is life beyond debt! And the pathway to that life is marked out in the article below:

The mindset

Mike Todd, an American film producer, once said, “I’ve never been poor, only broke. Being poor is a frame of mind. Being broke is only a temporary position.” Your mind is your strongest tool when it comes to dealing with the debt crisis. Instead of blaming your debt on the witches and wizards in your Father’s hometown, you have to try to understand how it happened and also realize that it has happened to a lot of people – even countries!

Economic and financial figures reveal that Ghana’s total debt stock (as at December, 2017) stands at GHc142.5 billion, representing 70% of our Gross Domestic Product (Source: BOG). So if it makes you feel any better, you are not the only one in debt. Make up your mind to come out of debt and work towards it. The results will amaze you.

Calculate your total debt volume

It is one thing feeling discomfort because you owe Eto, Dede, Messi and Yaa Manu all in one heap at the back of your mind. And it is a completely different thing putting pen to paper to see the horrific figures that plague your thoughts. Sometimes, you realize it is not even that bad and you get to sleep much better than you did before. Other times, you only rather realize how daunting your debt load is and that pushes you to work faster towards recovery. Whichever ways, you are better of knowing your exact debt load than walking the streets with shadows of undefined debt hovering over your head. It should not be a good feeling and we do not want that for you.

Start by listing out the names that immediately pop up. Then think deeper and try to remember all the people, banks and other institutions that you owe. After that, list out the corresponding figures and put them all together. Now you have something to work with. As and when you remember other debts, you add them to the list.

Adopt Positive steps for change

Now let’s move ahead to the solutions to your debt crisis. Here are some simple points to getting out of debt and achieving financial security:

Stop borrowing and buying on credit: It is a very wise thing to spend within your means. Resist the temptation to spend beyond your cash in hand. When one is serious about getting out of debt, any spending will be focused on needs, not wants and desires. The temptations—“Why wait when you can have it right now!” and “It’s yours for only three easy payments of …”—must be resisted. You must have the discipline and character to not spend beyond your means. President Calvin Coolidge once said, “There is no dignity quite so impressive, and no independence quite so important, as living within your means.”

Set a workable budget: If you are going to work your way out of debt, a written budget is a “must have”. If you are married, sit down with your spouse and build your budget together. You both need to know where your money is going (every pesewa). In drawing your budget, focus on needs: food, shelter, utilities and transportation. Consciously curtail expenditure such as eating out and buying at impulse. It is difficult, but you have to tell yourself it is only a phase.

Work. Consider doing a side job that allows you to make an alternative income. If you have any talents, this would be a good time to put it to use: sewing, braiding, selling, makeup works, event planning etc. It will mean some hard work and sacrifice, but if you’re serious about getting out of debt, that could help. Again, this need only be a temporary situation.

Renegotiate your debts. Once your recovery plan is all done. Renegotiate your outstanding debts and work towards promised dates. Try to make the timelines as realistic as possible. Nothing is as painful as being promised an amount of money due you and being disappointed. Debt is the last thing that you want to separate you from the people you once called friends or allies.

Do not be engulfed in stress and despair. Work towards recovery and debt will be a thing of the past. Fidelity Bank is here to give you all the support you need to achieve financial freedom.

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