dinero_admin February is usually a difficult month for finances, with debts accumulated from december and january. However, getting out of these commitments without compromising your economy is possible with a clear strategy and financial discipline.
Here are three keys to regain control of your money.
1. Prioritize and negotiate your payments
Make a list of all your debts and order them by urgency and interest. Contact your creditors to negotiate better terms or reduced rates. Many times, institutions are willing to adjust payments if you show intent to comply.
2. Apply the 50/30/20 rule
Allocate 50% of your income to basic needs, 30% to personal expenses and 20% to pay debts. If you can, temporarily adjust your budget to allocate a higher percentage to pay off outstanding debts and get out of trouble faster.
3. Generate extra income
Take advantage of skills or assets that you can monetize. From selling items you no longer use to offering freelance services, any additional income will help reduce the debt faster. The important thing is that this money is used exclusively to pay what you owe.
Remember, getting out of the debt cycle is possible with a solid strategy, discipline and a mindset shift towards saving and planning.
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