Becoming debt free takes tremendous dedication and brave choices, any business owner will attest to this. If you are concerned about debt, whether it be R5, 000 or R100, 000 — there’s no better time than the present to get on top of debt and put it behind you. To get you started, here are some expert financial tips, offering you realistic ways to become debt free sooner.
Treat Debt like an Injury
When debt starts to weigh on your bottom line, tackle it immediately. Stop the bleeding by identifying unnecessary expenses in your budget and cutting them out at once.
Make some temporary sacrifices and you’ll find you can save lots of money and slash the debt you have accumulated. If you have any subscriptions, like gaming memberships or Netflix these should be the first to go.
Eating out every night is unsustainable – prepare your meals at home and you’ll be taken aback by how much you can save. Another option is to downgrade your apartment and/or car. Once you are living within your means, your debt stress will just melt away – it’s a fair trade. Live lean and mean and sleep like a baby.
If you’re a business owner, there are many fairly simple ways to cut costs. Negotiate with vendors, cancel inessential subscriptions, consume less power in the office by using energy-saving light bulbs or cut back on needless employee perks.
You can save hundreds of rands just by picking up the phone and making a few calls. Go through all of your monthly bills and bargain down prices or switch to cheaper service providers. Recurring savings are the best kind of savings!
Earn More Money
Cutting down is the first step, finding ways to bring in more money is the second. It may seem like a hard pill to swallow, but many entrepreneurs keep their fingers in a number of money-making pies to keep their businesses afloat.
You could become a tutor, a dog walker or a translator in your spare time. These are good ways to earn some extra cash, which you can use to settle the debts draining your business. You need to make becoming debt free a top priority, once you do, everything else will fall into place.
The interest rates you are paying on all of your various debts add up. You may be able to cut down on the interest you paying by consolidating your debts with one big loan. Calculate how much interest you pay monthly on your loans.
If your interest rates are between 18-25%, you could seriously benefit from consolidation. Quick Consolidation Loans is a responsible lender who can offer you reliable, affordable consolidation that will help you save lots of money.
Know Your Limits
Hope and determination may be essential for entrepreneurship, but debt should never be taken lightly. You need to draw a line in the sand by set a stopping point when you will no longer be in debt.
Paying your bills and keeping the lights on with credit cards can land you in hot water quickly, if your business isn’t performing sufficiently. Be realistic about how quickly you are winning business and whether you will be able to cover costs going forward.
The number of sales you make and clients you win are direct indications of whether the debt you are accumulating is worth it. If your business isn’t growing, figure out why before taking out more debt. It’s the only way to gauge whether you it’s time to close your doors or take things to the next level.