Crucial Steps for Single Mothers to Eliminate Debt
Strategies for Debt Relief
Single mothers are far more likely as compared to two-parent couples to encounter lower credit scores, debts, and even bankruptcy.
As per the reports presented by the ‘National Bureau of Economic Research,’ single-mothers households are most likely to encounter poverty. Women generally run roughly 85% of the single-parent households, and around 42% of these single-parent households seemed to live in poverty.
Single mothers are forever grappling with debts and juggling multiple bills and outstanding payments such as utility bills, housing payments, childcare, and clothing.
Single moms are perpetually engaged in a struggle to evade bankruptcy declaration and recover or boost credit scores. If you are running the show as a single mom, remember you are doing a good job and that you are not the only one with such issues.
As per data from the U.S. Federal Reserve, American households have $15,863 on average, in terms of credit card debt and $33,090 in terms of student loans. Moreover, we understand as per reports published by the ‘Consumer Financial Protection Bureau’ that 53% of all credit bureau filings seem to be for medical debt.
As per Forbes, if you are neck-deep in overwhelming debts, remember you are certainly not a weirdo, or something is abnormal about you. Numerous others are in a similar situation as you are in; however, you must not use this fact as an excuse for lazing around and not trying your best to pay off all your existing debts.
If you are enduringly living each day thinking about ways to eliminate your debts, then the money that you are earning every month is never going to be yours. You seem to be permanently enslaved to your outstanding debts. This must be adversely impacting your mental health, peace of mind, career choices, and relationships. Single moms must never forget that there are several tried and tested techniques of eliminating your debts and lots of tech and analog resources to assist you.
Never Ignore Your Debt
The worst mistake that you could ever make is to ignore and undermine your debts. Your collection calls may have ceased, and you may have moved. That does not imply that you are entirely free from your debts. Remember, your debt records would be following you wherever you go. Just because you have opted for debt consolidation, that does not automatically mean that you have eliminated all your debts. You must take your debt issue rather seriously since you could fall in major trouble, and you may have to go through wage garnishments and many such undesirable consequences and legal actions. In the event you are keen on managing your debt and rebuilding your credit, you must analyze all your debt issues rationally and calmly. Try looking for effective debt relief solutions by tapping professional assistance from experts at NationaldebtRelief.com
Obtain Your Credit Score For Free
You must know your credit score at all times. It is a good idea to ask for your credit report from any of the authorized and authentic credit reporting agencies including the top 3 national credit bureaus such as Experian, Equifax, and TransUnion that are known to be competing with each other for capturing, updating, and storing credit histories on the majority of American consumers.
You Need To Be Organized
Single mothers must approach debts with a heavy hand. You must create a comprehensive list of all your outstanding debts, including clearly specified rates of interest, deadlines, and monthly minimum payments. You could use the monthly goals feature of Personal Capital. Use smart and cutting-edge digital tools and apps for staying organized and up-to-date. Consider using Tiller, which is a popular budgeting tool. You must seriously consider getting rid of any additional spending, and focus on lowering your overhead. You must constantly remind yourself that you are in this financial mess simply because of your habit of careless spending and overspending. Keep imagining how awesome it would feel to lead a debt-free existence.
Look Out for Credit Cards with Lower Interest Rates
Depending on your current credit score and credit history, you could get credit cards that offer a lower interest rate. Your credit score is often important for being eligible for certain lower interest credit card loans. You must, first of all, examine if you are eligible for a Zero percent balance transfer. This is undoubtedly an effective way of paying off your outstanding debts and saving a substantial amount in terms of interests.
This would work fine, provided you are well-organized. Carefully read the fine print and pay all the premiums promptly and on time. You must focus on either paying off the balance or transferring the balance before the promotion period comes to an end. You need to be truthful about your capacity and skills. If you are not adept at this sort of bookkeeping, you may opt for something else.
Opt For Debt Consolidation
Consider combining your multiple existing debts into a single bigger debt, generally, with a relatively lower rate of interest and a single monthly payment. Private Banks and many other agencies offer effective debt consolidation. If you have a robust credit score, you could find it quite easy to obtain a debt consolidation. You could make good savings by opting for debt consolidation.
Make the Right Decision: Choose Between Debt Snowball & Debt Avalanche
You could pay off your debts either by debt snowball method or debt avalanche method.
Debt Avalanche: You start by paying off your accounts, having the highest rate of interest first. The biggest advantage of the debt avalanche method is that you end up saving substantial money by eliminating high-interest rates one by one.
Debt Snowball: In this method, you would be concentrating on paying off your loans with the lowest balances initially. The major advantage seems to be the fact that you encounter a major emotional and psychological ecstasy and thrill of effectively paying off all your accounts quickly from smallest to biggest.
You must seek professional assistance if you are stressed out because of overpowering debts. If you are failing to get out of the debt trap, you must talk to debt specialists at reputed debt relief organizations or get in touch with qualified credit counselors who could assist you by chalking out an appropriate debt repayment plan for you.
Moreover, single mothers must keep track of their credit reports and credit score. You must examine your credit report meticulously. Whenever you identify any errors present in your credit report, you must take proactive steps to rectify them.
If you follow the tips discussed above, you could get rid of your debts. You could rejoice once you are free from debts. However, do not get back to overspending. Instead, focus on saving and try to achieve your financial goals and aspirations seriously. Strictly follow a budget and keep track of your credit score.