Shredding Debt: enableMe Has Some Answers

It seems like everyone out there has advice on shredding debt. Some of it good, some bad – but most of it is simply incomplete. In order to get yourself out of debt, you have to apply some extremely clear-cut measures to your financial life, and the first thing is to stop the bleeding. Shred any cards, aside from the ones you use for emergencies, and stop acquiring any new debts. You must cease the cycle of debt, and place yourself on a firm budget.

As enableMe’s Hannah McQueen explains, “There is clear evidence that credit cards disconnect us from our spending and encourage us to spend more.

You should consider using cash for a couple of months to see if you naturally spend less. In fact, when I start to work with clients, I have them use cash for three months for their most frequent costs. This tends to focus on food and drink.

“Beyond the first quarter, I have no preference if they revert back to using cards or stick with cash, provided they hit the targets they set when they were more focused. The key here is the first step towards financial progress is awareness. If society becomes even more cashless, then you must take steps to offset the proven tendency of spending more, by analysing your spending more rigorously, so to avoid the fritter creep.”

McQueen recommends sitting down, being brutally honest about where you're at, and then making a plan of how you will pay everything off. If your credit card has reached its limit and you've hit a financial wall you can bypass a brewing interest bill by changing banks to get a new low interest deal.

Credit card balance transfers allow consumers to offload a higher interest debt held on an existing credit card onto a low interest offering from another lender.

McQueen says you should consider a credit balance transfer if you are not in a position to clear your credit card debt in full each month, as a transfer should make it easier for you to pay off the debt because the interest rate is lower.

A credit balance transfer can buy you a valuable asset - time – so you can pay your debt at a much cheaper cost.

However, if you don't have a strategy to pay off the debt during the low interest term you will end up back where you started. As McQueen says, "This is the overwhelming result for a lot of people. They don't get ahead; they fritter the time away." This is a no-brainer, up there with ‘pay your card off in full every month’.

enableMe offer expert independent and impartial advice via one-on-one coaching and enable you to get in control and get ahead. They’ll also be there to support you every step of the way towards financial freedom, so to find out more about financial advisors, budget advisors and financial planning please go to http://enableme.co.nz .