A. M. 
Being in debt is a common situation for many people and families, especially in contexts of inflation, unexpected expenses, or loss of income. However, having debt doesn’t mean you’re in a hopeless situation. With organization, discipline, and a clear strategy, it’s possible to regain control of your finances and reduce financial stress.
Recognize the situation and make a diagnosis
The first step to reorganizing is knowing exactly how much you owe. This involves listing all your debts: credit cards, personal loans, mortgages, student loans, or informal debts. It’s important to note the total amount, the interest rate, the monthly payment, and the due date. This diagnosis allows you to see the complete picture and make informed decisions.
Prioritize the most expensive debts
Not all debts are created equal. Credit cards and consumer loans typically have higher interest rates, causing debt to grow rapidly. An effective strategy is to prioritize paying off the debts with the highest interest rates while making the minimum payments on the others. This reduces the total cost you’ll pay in the long run.
Create a realistic budget
A budget is a key tool for getting out of debt. It involves tracking all your monthly income and expenses, differentiating between basic needs (food, housing, transportation) and non-essential expenses (entertainment, subscriptions, impulse purchases). Reducing unnecessary spending frees up money to pay off debts faster.
Negotiating with creditors
Many people don’t know that it’s possible to negotiate with banks and financial institutions. Some offer restructuring, debt consolidation, reduced interest rates, or longer payment plans. Contacting your creditor before falling into arrears can prevent late fees, additional interest, and minimize the impact on your credit history.
Consolidating debts: is it right for you?
Consolidation involves combining several debts into a single loan with a lower interest rate and a single monthly payment. This option can make managing your money easier, but it should be carefully considered to avoid extending the repayment term too much and ending up paying more in interest.
Avoid taking on new debt
While reorganizing your finances, it’s crucial to avoid taking on new obligations. This includes limiting credit card use and avoiding installment purchases that aren’t strictly necessary. The goal is to stop the problem from growing while you work on a solution.
Create an emergency fund
Although it may seem difficult when you’re in debt, saving a small amount each month helps you cope with unexpected expenses without resorting to more credit. An emergency fund, even a modest one, reduces the likelihood of going back into debt when faced with unforeseen costs.
Seek financial advice
If the situation is complex, consulting a financial advisor or participating in financial literacy programs can be very helpful. These resources offer guidance on structuring a payment plan and improving spending habits.
Reorganizing when already in debt requires discipline, patience, and consistency, but it is an achievable goal. With a clear plan, spending control, and debt prioritization, people can regain their financial stability and build a more solid foundation for the future.
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