Hello Lions on the LeoFinance ecosystem! It's a beautiful day that brings hope to you and your family and to make this more meaningful, the cryptoverse has a glorious future for all of us. Good morning!
I have discovered one challenge facing most people in their journey to get financial freedom and that is indebtedness. Many us the wrong techniques in their bid to come out of indebtedness and that's getting loan from either banks or private lending cooperatives.
It should be noted that collecting loan to improve the status of one's business or to start up a business isn't on its own bad, but what is wrong is the strategy put in place to offset such loans.
Loans are supposed to service themselves. What I mean here is that the collected show be put into good use in order to pay back the loan as well as become more profitable to the collector.
Loaning to offset loans
I know about a friend who usually move from one lender to the other in order to offset one loan or the other. The other day he came to me to loan money from me and I quickly asked him the reason for loaning from me and he said a certain person that he borrowed money from came asking for his money.
This is a very wrong way to offset debts I told him. It makes to get more indebted, thus, it'll limit you from growing financially.
How to clear loans and become debt free?
Truly speaking coming out of financial debt is a very difficult process but it can only be achieved with time if one utilities the required strategies. This process might reduce your spending life drastically and also push to wanting to become more indebted but with due diligence you'll overcome. Be are the required steps:
- list down all the people you owe. This is very important in order to know the exact amount of money the owing. In the section also list the interest on the loan if they aren't interest free loans. Listing them helps you strategize on the payment procedures.
- write down your income and expenditures for the month. This will help you know the percentage to spend and the one for the repayment of the loans. From your income and expenditure, you can now fix a certain amount of money to pay per week or month.
- Reduce Your Interest Rates
It can be difficult to pay off debt when you're battling with high interest rates. Reducing your rates is a promising strategy to make getting out of debt more manageable and affordable. You can negotiate the interest rate if you have a good payment system with the lenders. This on its own will help you with the burden of the loan payments. - save more and spend less. Saving has a way of helping you with significant amount of money to repay your loans.
Conclusion:
Never you pay loan by collecting more loans from other lenders. I'll only push you into indebtedness and at it's extreme it'll lead you into bankruptcy.
Thanks!