LIQUIDATE, DON’T CAPITULATE UNDER DEBT

The year was 2007 and Naira Debit Cards had just recently been introduced to Nigeria. I rushed to acquire one believing I could invest the money wisely and from my investment make enough to pay the bank with minimal interest. Alas my naïve plans were woeful failures and I lost all my initial capital.

Instead of working out ways and means to quickly repay the bank I capitulated by going into denial mode pretending my debt didn’t exist. The interest kept piling up until what I owed was more than double my initial loan. By this time the bank’s recovery team started calling and harassing me and I was forced to commence repayment measures until I completely liquidated it. I still remember the feeling of exhilaration I experienced when my debt was finally paid in full.

Are you currently in debt? Are your creditors threatening to deal with you over money that is unpaid? My charge to you today is not to buckle under the weight or pressure occasioned by your current circumstances. You should rather seek for ways to speedily pay them off. A wise man once said that “borrowing is easy, repaying is difficult,” and I wholeheartedly agree.  I urge you to consider taking the following steps to pay off your debts as soon as possible:

The first thing to do is to first research and document exactly how much you owe. You will be surprised how many people don’t have a clear picture of their debt profile. Spend time finding out from the bank or reading up your loan agreements to get a full and clear idea of exactly how much you are in the “red” for. Find out what you owe and who you owe it to, and also the interest rate so you can calculate the current value of the debt as the months go by.

Once this is confirmed seek for a meeting with your creditors to give them an update with regards to your inability to repay as promised. Many people would rather dodge and hide away from those they owe. This only serves to increase animosity between both parties; instead make yourself available and accessible to your creditors. Find out if it is possible for them to give you more time or a period of grace to enable you repay. It is however most unlikely if you owed a bank that they would grant you any amnesty because there is a signed contract whose terms you have to honour.

The next step is to commence repayment. Divide your monthly income into three portions – Sixty percent will go into your living expenses, thirty percent of what is left into repayment of your debts and the remaining ten percent as savings towards your future. It is wise if you owe a bank and other creditors to try to pay the bank first due to the burden of additional interest. This is however dependent on the understanding of your creditors. You may have to divide the amount earmarked between all of them and commence continual paymentinstalmentally.

Fourth, actively seek for ways to increase your earnings/income. During this period of loan repayment invest in your personal development with a view to growing your income. Get a better paying job or try to develop another source of income as soon as possible. The extra inflows will help you to make faster repayments to your creditors.

The liquidating your debts phase is a most trying period for all debtors, so you must brace up with all the honour and dignity you can possibly muster to ensure that you cut off all unnecessary expenditure and  live within your sixty percent. It would be completely calamitous to fail your creditors again after starting this process. Strive to deprive yourself of certain things so you can repay as quickly as possible. The cloud of debt won’t last forever, one day it will be over.

Most importantly learn from your mistakes! Find out the reasons or decisions that brought you to this current situation and determine not to make the same mistakes again. You are where you are based on a decision taken in the past. Once you become enlightened whenever you reach that stage to take a decision you will be much better informed to take the right steps.

Finally endeavor to master money. Money and wealth acquisition are guided by certain rules and formulas. The good news is that these formulas will work wherever you are located, and they do not discriminate. Go on an adventure to get the best this life can offer you financially. You owe it to yourself and to everyone around you.

Debts are meant to be liquidated and not capitulated under. Keep these facts and steps in mind and you will be able to defeat and conquer debt by liquidating them as soon as possible.

Article By : Kenneth Doghudje