With the highest market rates, on average 138.5% a year, according to the Central Bank (BC), the overdraft should be avoided to the maximum or, in cases of extreme necessity, removed as soon as possible. If this does not happen, you may be surprised at the debt that is fast growing, and if it is not paid, it can turn into a snowball!
If you identified with the problem in question and do not know how to solve it? It’s time to change the situation and get out of the overdraft! With calm, planning and following some tips it is possible to jump out of this mess.
Analyze your debt and pay the amount
The first step is to assess your situation. Do you have any other debt? In case of accumulation of debit balance it is necessary to also include the other accounts pending in your financial planning. The suggestion here is to first debit the debts that present the higher rates or try to pay the installments simultaneously.
If the problem was only with the overdraft it is easier to solve: What is the real and current value of your debt? Do you have the value to cover your spending now? If yes, the most recommended is to pay. If not, what is the percentage of interest and monthly charges to be paid? Put everything on the tip of the pencil and make an estimate of the debt for the next period. Time to change the routine and make a financial plan to get it off as soon as possible!
Analyze your finances, monitor monthly fixed and variable expenses, and organize yourself
Ideally, you work with a financial spreadsheet so you can keep track of your fixed, variable expenses, available value to pay off the debt, and visualize what you can save to solve the problem.
Consider in this worksheet your earnings and subtract from them all estimates of your fixed and variable expenses. How much will you have available? Is the amount sufficient to pay off the debt on the date considering fees and charges without acquiring new debits? If this is not possible, review what you can cut or cut your spending to make the payment. If it is still not enough, check out the 5 tips we have selected to help you:
Tip 1: Seek your bank for a negotiation
There is no reason to be ashamed. Just like you, thousands of people are trying to solve the same problem and get to the end of the month with some money and no debts.
When asking for help from your manager, be honest. Inform you about your interest in repaying the debt and your actual financial situation according to previous analyzes. Together, you will find a way to pay off the arrears by amortizing it even if through the installment payment. In this case, try to settle as much as you can from the spot value and divide the rest into as few installments as possible.
Tip 2: Replace debt with lower rate
In this case, take the opportunity to ask those who are assisting you with other credit options that present cheaper interest rates. Ask, for example, if it is possible to get a payroll loan, where the installments are deducted directly from your salary and have one of the best rates in the market.
Tip 3: Cut some expenses
With your financial analysis you will realize the expenses that can be reduced or eliminated. Share the situation with your family and ask for help in saving light, reviewing telephony plans, cable TV and internet, for example. Define what is essential and what can be cut to save and repay your debt in a shorter time frame.
Tip 4: Sell some goods
What do you have at home but do not like it so much, do not want more, do not need or can stay some time without? It could be a car, a motorcycle, a TV that nobody uses. Check what you can undo and give you some money to clear this debt as soon as possible.
Tip 5: Use the extra money
Use your extra money as your 13th salary, vacation, prizes, bonuses, gratuities, commissions to clear debt as soon as possible. You may have to postpone some plans, but what you will be spared by eliminating excessive interest expenses will pay off. Following a financial planning very soon will be possible to resume the project of a trip or new acquisitions.
And after the debt is paid?
By removing that debt, cancel the overdraft, or be certain that the changes you have made to complete the debt will change your attitude to money, and of course the most important thing from now on is saving. Reserve at least 10% of your winnings. You never know when you might need the money. This will be the best way not to get involved in new financial problems.
There is no secret. Your debts correspond to expenses higher than your receipts. So the best way to avoid them is to keep your finances organized.