Practical Exercise to Deal With Debt

Debt is considered to be one of the most damaging problems. Whether it is your personal finances and emotional self-management, both of these aspects will are at risk. When you are in debt, it creates a constant mini-stress that your brain has to deal with. You sleep, you eat, you work, but the stress caused by debt is there. Eventually, the stress multiplies and accumulates causing a number of problems with your personal life, career, and family.

In many cases, the psychological damage of being in debt is being seriously underestimated. The person may not fully realize that his bad mood and emotional swings are actually caused by brain’s inability to cope with emotional pressure that is being caused by debt.

Why do we talk about the debt causing issues? The answer is simple. You can learn to locate and deal with emotional consequences of being in debt. Today, we would like to share with you practical exercise that can help you to manage your emotional state better that will lead to making rational and well thought out decisions with your money. Follow these easy steps and see the positive results within 3 days.

Emotions. Start with full acceptance of your current emotional state that is being caused by the presence of debt. Try to identify the emotions (anger, frustration, guilt, sadness, anxiety) and allow yourself to ‘sink’ into these feeling to the fullest. Not to worry, this exercise has been given to the number of people and the results were astonishing.

Writing. Take a piece of paper and write what you think about the debt in general. Whether it is negative or positive beliefs, it doesn’t matter. Your primary goal to open yourself up to the worse picture ever and write about it. This step will help you to locate negative concepts about debt. These negative thoughts, beliefs and past experiences are disaster-causing roots that hold you back. By writing them out on the piece of paper, you are actually letting go of them. New positive concepts that completely are able to reflect your own personality are about to appear on their own.

Brainstorming. Write about 20 options on how you can pay off the debt. Try to be mostly irrational and it will help you to come up with new ideas on how you can fix your current finances.

Action. In our day-to-day lives we live a comfortable life. But sometimes we have to step out from our comfort zone in order to expand our life’s horizons. In order to step out of your comfort zone, come up with something you never did or tried and do it during this next week.

Debt. Write positive concepts about debt. While dealing with debt, you have learnt new things. Try to summarize and to see what positive results you may have received from debt. Probably, you have obtained more self-assurance as you made greater purchases. You may have learnt to make more money. You have learnt to hold … Read More

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5 Sources of Money You Did Not Know That Existed

Sometimes you and I stumble upon an old fund we had totally forgotten about. Of course, we should jump for joy when that happens! But think about reality. Most of us are burdened by debts. Sure, it is a good way to use that old fun to pay off your loans. But the list below may uncover more “secret” funds you might not realize yourself:-

For your insurance coverage, borrow against your cash worth

Let us assume you were approached by an insurance agent (specializing in life coverage). He or she would probably be hell bent on selling to you cash value policies. Why is that so? Well, for one simple reason. They earn much more commission from sales that way!

Sometimes, when we were young, our parents themselves have fallen into the trap of buying such a policy type. Now that we know about this, use it to your advantage. You could borrow against the cash value to clear or at least pay off some lingering bad debts. On a side note, it is advised that you might discontinue altogether your cash value policy and just withdraw the available, remaining cash.

Auction off assets and investments that are not within your retirement account

Find out if you have a share or bond lying around in your old portfolio. You should think about turning these paper assets into cold hard cash. Then use the money to pay down your consumer loans. However, be smart to care for your taxes. Doing so (selling off your assets) might cause you to get taxed. In this case, only sell the ones that would not get a tax bill on your side.

Property at home can be used to your advantage

How is this possible? Simple. Borrow against your home equity. Home equity value is defined as the difference between its market value and current remaining loan balance. Then what you do is borrow against real estate at a lower interest rate and get your taxes to be reduced.

A word of warning: Make sure that you do not overdo the borrowing process. It might fall for foreclosure risks.

Working for your boss?

Know that you can also borrow against the retirement account (which belongs to your employer). Do your homework first. Check whether this is possible or not at the first place at the correct department. You will find that the rate of interest is normally fine for you. In the case of sudden retrenchment or such cases, you might have to repay the loan within a 2-month period.

If you have more friends and family, the better

They are your closest people to you in your life. At times of financial trouble, you could often rely on them to borrow money. However, do it professionally. Have a written agreement (a general and not overly complicated one) that has the necessary terms and conditions. Last of all, please do pay them back. Show your gratitude to the closest people you know. … Read More

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