Merel (18): ‘When I see something nice, I immediately want it. I bought a laptop on installment, borrowed money from my mother and friends and have been overdrawn in the bank for a number of months. I can be careful not to get into debt. Actually, I already have it.’
If you do not repay borrowed money on time, debts will arise. You borrow money from family, friends, the bank or another financial institution. Borrowing money seems very attractive, because thanks to the borrowed money you can buy the computer now, instead of in a few months.
How can you avoid debt?
When you buy a home, it is of course logical that you take out a mortgage loan. But in general, it is not wise to borrow. Don’t take out loans or make installment purchases. Save until you can afford that washing machine, instead of borrowing it. You always pay more than the purchase price. The same applies to lease cars. The amount can really add up. Do not take out subscriptions for your mobile phone, but buy a prepaid card. In any case, you have to be very careful when taking out subscriptions. You can also borrow magazines, such as Libelle, from the library.
How do you get out of debt?
You can beat around the bush for a long time. You can bury your head in the sand. Some people keep that up for years. But don’t forget that the problem is there. Even if you look the other way, the creditors certainly don’t. The measures go from bad to worse. Means that companies can use to make you pay include disconnecting your telephone, garnishing your salary, sending a bailiff to look after you or even evicting you. Don’t let it get to this point!
Below are some tips to help you get out of debt.
- Make a cash book. This is a booklet in which you record all your income and expenses. From the smallest bottle of shampoo to filling up the tank of your car. This way you gain insight into your spending pattern. Many people with debts have a structural deficit. For example, every month they are short three hundred euros. In this way, the debt can quickly rise to 3,600 euros per year.
- Such a cash book may help you find out the cause of your debts. Maybe they are also debts from the past that you continue to carry around with you like a bag of bricks. Changes in spending habits can help reduce debt.
- Smoking is an extremely expensive hobby, which is not only bad for your wallet, but also for your health. Stop this. You will have to make choices. Do you have pets? Consider selling one or a few.
- If you have relatively high housing costs, moving may be an option. However, this also entails many costs.
- Low income can also be the cause of debt. Look for opportunities to work extra. There may also be opportunities to receive subsidies, such as child benefit, a contribution towards study costs or remission of municipal taxes.
- If the cause is in your purchasing behavior; Then ask yourself from now on: do I really need this? Every time you are about to buy something, ask yourself this question.
- From now on, go shopping at cheap supermarkets such as Aldi and Lidl.
- Buy clothes on sale.
- Maybe you still have clothes hanging in the closet that you no longer use, or a DVD collection… You can always try to sell them via marktplaats or another trading site.
- Do you have a second car? Then get it out immediately. If you are in debt, you simply cannot afford this luxury anymore.
- Reduce the monthly costs of a loan. This can be done in various ways. This way you can try to extend the term of the loan. You pay more interest in total, but spread over a longer period, so that the monthly costs decrease. Another option is to convert a personal loan into a revolving credit.
- Propose a settlement to the creditors. Send them a letter asking for an arrangement. Ask if you can temporarily stop repaying so that you can pay off smaller debts first.
If you can’t get out of debt
Do you no longer see the forest for the trees? Have you done everything you can, but nothing seems to help you climb out of the valley of debt? Then seek professional help at a credit bank in your area, or hire a budget coach.