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Things can get hairy fast without the proper management skills. This leads to that feeling of dread when it comes to finances, and can cause a lot of undue stress. The key is understanding the difference between good debt and bad debt.
As this distinction notes, not all money owed is contrary to better financial health. But it takes discipline, and laser focus to ensure you’re getting the latter and not the former. Read on for a comprehensive breakdown of how to manage this well.
The first step here is to ensure that you don’t incur extensive amounts of debt from the onset. There’s already a common metric for maintaining your existing accounts. Keeping your balances below 30% use is a great guideline to ensuring good debt.
But the more you take on across separate accounts, the more it will negatively impact your credit history. Your goal should be matching your debits with your income. Don’t take anything on that your monthly take home can’t handle. And if your debts are already on the higher end, try assessing your income for all possible means of expanding it. More on that in one of our previous articles, found here.
If your income doesn’t provide the kind of options you need for dealing with this concern, all is not lost. There are a few other methods that can help a great deal to ease the burden. First, try scaling back on your current liabilities. Most debt is a result of leaving above the current means. Reassess which of these liabilities are negotiable, and adjust accordingly.
Also, you can try talking to your lender. It’s often the case that you aren’t getting the best possible interest rate at first. It takes some digging, but they should be willing to review your current standing for any possible reprieves. Lastly, you can always seek to consolidate your portfolio via an applicable consolidation outlet.
Debt can be a scary mountain to climb. But with the right help, you can guarantee that you’ll have a much better go of things. That’s where FitnessBank comes in. Our top tier services and supports can help lead you closer to good debt, while filtering out the bad. Contact one of our lenders today to learn more.
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