5 Factors That Can Derail Your Efforts to Go Debt-Free
Have you ever dreamed of living debt-free? It can seem like an impossible goal, but it’s easier than you might think. Many factors cause people to get into more debt and make it hard to pay off the existing balance. In this blog post, we’ll discuss some of these factors and how they can derail your efforts to go debt-free.
- Untreated drug or alcohol addiction
Untreated drug or alcohol addiction can quickly spiral out of control and cause people to rack up debt. In addition, it is difficult for someone with a substance abuse problem to hold down a job that pays enough money to allow them to put anything toward their debt payments each month. If you know someone who has this issue, encourage them to seek help from an organization to get back on track. Available drug rehab in Georgia and other states across the country can help those struggling with drug or alcohol addiction.
- Poor Understanding of Basic Financial Information
Many people looking to get out of debt try to do it themselves. They think that if they can understand the basics of financial literacy, like how much money is coming in and how much is going out, then they’ll be able to go back to living their lives without worrying about financial stress. Unfortunately, this line of thinking often leads people into more debt because they don’t have a solid plan for what needs fixing or where the problems lie. By working with someone who understands these concepts better than you do – such as an accountant or financial planner – you can avoid taking on too many risks and make your dream come true sooner rather than later.
One example is when a person decides to tackle their debt alone because they don’t know how long it will take to pay off. This can be more complicated than it sounds, which is why you have to find someone who has the proper knowledge base before you start taking on new debt.
You might find it challenging to stay motivated if you’re taking on new debt while still trying to pay off your old debts. This can make things even more complicated because you’ll have to deal with multiple credit cards, loan repayments, and all the related interest fees. While some people can juggle these financial obligations by themselves, they may find it difficult or even impossible to stay focused on their goals, which is why you should see a financial planner instead.
- Bad Spending Habits
It is effortless for people to spend money without even noticing it. This can lead to the accumulation of debt, which is often hard to get out of. You must be aware of your spending habits and try your best not to accumulate any more debt if possible. E.g.:
- Not having a budget
- Using credit cards to buy things you cannot afford
- Not paying your bills on time
- Not shopping around for the best deals
- Not saving for vacations
- Not knowing when to say no
- Keeping the same lifestyle over time
- Not Making Sacrifices When You Need To
If you’ve got more than enough in savings and built up some emergency fund (ideally 6-12 months of living expenses), then you can afford to be a little more aggressive in your debt payoff plan. But if that’s not the case, then you’ll need to make some sacrifices to free up cash flow. This may mean eating out less, brown-bagging your lunch instead, or finding ways to reduce your utility bills.
- Listening To Someone Who Doesn’t Have Your Best Interest at Heart
I’m not just talking about a shady credit counselor here; I’m also referring to friends and family members who want the best for you but don’t have all of the facts. Some people may say, “Oh, don’t worry, it will get better,” while others may suggest you run an overdraft or transfer a balance from another card so you can keep buying. It’s your plan; make sure that whatever advice you’re getting aligns with what YOU want for yourself.
Conclusion
Many people get into debt trouble because they try to fix their finances independently. If you genuinely want to get out of debt once and for all, you need the help of a professional who can put together a plan that is customized just for you.
