fbpx

Empowering the Next Generation Entrepreneurs with Profitable Ideas

How To Get Out Of Debt When You Are Broke

Do you want to know how to get out of debt when you are broke? Here are the tips you need to do that!
Reading Time: 4 minutes

Many debtors are asking about how do I get out of debt with no money. Indeed, it can be worrisome when you owe and you don’t have the means to pay up. That is the dilemma debtors find themselves in and sadly, many of them don’t have the funds to pay off what they owe.

Can I Get Out of Debt Even if I Am Broke?

Getting out of debt or paying off what you owe is not easy on anyone. How much more a debtor that doesn’t have the finances to do that.

You must first understand that being a debtor isn’t a life sentence. Instead, it is an opportunity for you to think of creative ways to get out of debt.

We have gathered some of the helpful strategies that you can use right now to get out of debt when you are broke.

How To Get Out of Debt With No Money

We are about to let you into the secret ways smart debtors have been paying off what they owe even when they are broke. Are you willing to learn these tips too? Then read on and start implementing them as soon as you can.

1.      Make A Budget

You may be attracting more debts than what you currently owe if you don’t have a budget to guide you. That is why it is important that you make a budget and try as much as you can to stick to it at all times.

2.      Concentrate on One Debt at A Time

Undoubted, looking at the totality of what you owe can cause you to have a heartache. That is not want for yourself, or is it?

The first step on how to get out of debt when you are broke is to understand that you cannot tackle all the debts at once. Rather, you are to focus on one debt at a time.

When you are through with settling that account, you can then look at the next debt to pay off.

3.      Are You Broke or Overspending

Most times, what we call “broke” is actually overspending. From spending money at parties to making impulse buying, you may be spending your money on things you never budgeted for.

In that case, you have to take a seat and start looking at how you have been spending your money. Cancel out the things that you don’t need and focus on those that you truly need.

Remember, you are getting to spend on your needs and not your wants. Your wants should never take the place of your needs except you have the money to foot such frivolities, and that, you don’t have at this time.

4.      Cut Up Your Credit Cards

You may be tempted to increase your debts and that is where your credit cards come in. You see, you may consider taking out some money from your credit cards so you can use it to pay off your debts.

Doing that means that you are robbing Peter to pay Paul – you are borrowing to pay off debt and attracting more debts at the same time.

Hence, the best thing to do is to cut up credit cards. That way, you will tie up any loose ends and have time to concentrate on how to get out of your current debts instead of getting into more.

Read More: 5 Easy Ways to Set Milestones for Your Business

5.      Be Consistent With Payments

Some debtors make the mistake of not being consistent with paying off their debts. That shouldn’t be so because it sends signals that such debtors weren’t interested in paying off what they owe in the first place.

Therefore, how to get out of debt plan you should be applying here is to get in the habit of making your repayments and on time too.

That, in turn, helps you to avoid additional fees. You will also be able to fast-track your payments instead of getting slowed down because you failed to pay up at some intervals.

Further Reading: 6 Undeniable Reasons Why Some Entrepreneurs Fail in Business

6.      Ask for Lower Interest Rates

You have acquired the debts and you are committed to paying them off. One of the ideal things to do here is to negotiate with your creditors to see if they can be lenient enough to reduce the interest rates.

Since you may not be able to gain traction in your schemes on how to get out of debt with no money and bad credit; the lower interest rates you will get (on request) will help you enough to repay what you owe in good time.

7.      Get in Touch With A Credit Counselling Agency

Sometimes, you may not be able to figure it out all by yourself. Sometimes, you may need to consult a Credit Counselling Agency to put you through on the things you need to do to pay what you owe,

One of the amazing things about the agency is that you will be able to get a Debt Management Plan (DMP) that helps you in distributing any amount you pay across to the different creditors you owe.

With such a method, the Credit Counselling Agency will help in managing your debt while committing some funds to your creditors until you completely settle your debts.

Being Broke Doesn’t Stop You from Getting Out of Debt

That you are broke doesn’t mean that you will not be able to pay off your debts. Provided you applied the strategies we discussed above, you will be on your way to becoming debt-free.

Are you broke but you have been able to settle your debts? Kindly share how you achieved that so that others can take a cue too!

Related articles

You can pay off the debt you own in one year. Follow the helpful tips here to discover how to become debt-free in less than one year.

How To Become Debt-Free In Less Than One Year

Reading Time: 4 minutes Some people have accumulated debts and are now looking for how to become debt-free. Indeed, being a debtor is not one of the best things anybody can wish for. For one, you will be ashamed and feel less of yourself when your creditor comes around. It can be embarrassing when you are forced to pay […]

Leave a Reply

Your email address will not be published. Required fields are marked *