The word ‘debt’ can send shivers down everyone’s spine. When you are deep in debt, it is only natural to feel stressed out. It is not easy managing various loans like car repayment, student loan, utility bills, medical bills and credit card bills. Defaulting on just one monthly payment can send you into a spiral with high-interest rates. Debt Consolidation Barrie is one of the best ways to get a handle on all your debts. The consolidation process works by combining all your debts into one big loan. The repayment of this loan is in the form of one payment each month. However, before you can opt for the process, you must undergo credit counselling. When it comes to handling finances, everyone’s situation is different and credit counselling will help you to get a deeper understanding of the problem. There are three main steps in credit counselling.
Step 1: Assessing your financial situation
Before seeking the solution, the problem needs to be understood well. You would be required to share a transparent picture of your income, assets, debts and lifestyle expenses. This process helps to get the exact number. The more objective and clear the picture, the better solutions would be provided to you. In this step, you would have to disclose your day to day life to the counsellor. This step might seem extremely uncomfortable to many people because it could make you feel like the questions are invading your privacy. However, all the questions asked are crucial as it is the understanding which will help the counsellor to find the right solutions for you. If the questions make you feel uncomfortable, it would be helpful to remind yourself of the long term goal of getting out of debt.
Step 2: Finding customized Solutions
Now that the problem has been understood by the counsellor and explained to you in grave detail, the very next step is to find the solutions. When it comes to finding financial solutions, there is no one correct answer. The approach to solving debt situations is dependent on various situations. You would be provided with multiple solution options. At this step, you would be told whether debt consolidation is the way to go or not. The other steps you could take to repay the loan. The options provided to you would be simple and will help ensure that you can successfully pay off your debt.
Step 3: Long term Money Management
Finding yourself in debt up to your neck is not a great feeling. When you are finally able to get yourself out of it, you must stay out of it. Debt should always be seen as a learning experience. Once you have been able to get a handle on the situation, the counsellor will teach you how to manage your money. These money management tips and skills will help you to prevent being overwhelmed by debt or taking a loan. These tips will help you to live a financially sound future.