What are some of the most create ways to deal with debt?

Question:

What are some of the most create ways to deal with debt?

Debt:

Money that is borrowed from one person to other is debt. The money is borrowed under the condition that it will pay back on future dates. Debt arises when a person plan to spend more than their current income.

Answer and Explanation:

The most create ways to deal with debt are:

a) The List of debt should be made that is the total payment, monthly payment. The list will provide a clear picture of the debt.

b) Pay the bill on time, if any lag happens leads to an increase in interest rate. Create an alert like calendar or alarm to remind the bill payment for the timely payment without due.

c) The best strategy is giving priority to high interest rate debts, example credit card has a higher interest rate.

d) To plan the expenses, keep a monthly budget .Early planning of budget, helps to spend the money wisely.

e) Always choose a lower interest rate, higher interest rate leads to great debtor and payment goes to monthly interest charges, not to the principal amount.


Learn more about this topic:

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Long-Term Debt: Definition, Cost & Formula

from Financial Accounting: Help and Review

Chapter 8 / Lesson 7
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