6 Ways to Manage Debt & Improve Financial Well-Being
November is Financial Literacy Month, a time when Canadians are encouraged to take control of their finances to reduce stress and improve their financial well-being.
For some, this can mean creating and sticking to a budget; for others, it could be contributing towards their savings; and in today’s world of staggering real estate prices and high inflation, it might mean following a debt reduction plan that is unique to you.
These days, taking on debt is pretty much unavoidable. The good news is, there are ways to manage your debt – and your stress – with the right plan in place.
6 Tips to Manage Debt and Improve Your Financial Health
- Reduce your budget — look at where you could cut back on things like dining out and other non-essential purchases. Use this money to pay down your debt, and reward yourself when you’re reached a payment goal instead!
- Contribute as much as you can toward each debt each month. Try to pay more than the minimum owed, but never pay less to protect your credit rating.
- Always pay off the loan with the highest interest rate first. Once you’ve finished paying off this first loan, start paying more on to your next highest debt. (Hint: Your credit card is likely costing you the most in interest, so start there!)
- Consider a consolidation loan. You can reduce your interest charges by grouping all of your debts into one low-interest loan. You may want to look into a home-equity loan or a line of credit. Not sure where to start? Seek out a qualified professional.
- Find out how Term life insurance can help. If you or your spouse were to die unexpectedly, could the remaining partner carry all of the debt on their own? The answer is typically no. The right life insurance policy can help ensure your mortgage and any additional debts are covered in the event two salaries are reduced to one.
- Speak with the experts. Managing debt is always easier with the help of a qualified professional. The right person can help you categorize your debts, assign measurable goals, and set realistic plans to reduce and eliminate your debts as efficiently as possible.
Want to improve your financial well-being? We can help. Get started by answering a few short questions, and one of our friendly Serenia Life advisors will be in touch.
Subscribe to keep updated with the latest news.