Getting Out of Debt Drowning

During my student years, I have to ask everything from my sponsors the things I needed – for my project, my thesis, my computer rentals, for book bindings, for fieldtrips, etc.

But when that days are over and I started working, I tasted the fruits of receiving a gratifying pay all just for myself, myself! While working for great companies, credit card offers and perks are heaping up just to get you as their customer. As confident as I was, I took all the proffers without second thoughts. For the first time, I have washed out my aplenty compensation for shopping, travel, entertainments, gifts, gimmicks, and mostly in dining.

Little did I know that I lost control of my cash flow? Every now and then and as frequently as weekly, bills are coming in. Credit card debts from every bank I could think of, utility tabs that keep impending and collectors keep knocking on my door.



Brooding and dillydallying on my office desk, my phone rang and a loan agent with scripted greetings and modular voice said, “Hi, may I take a few minutes of your time? We have great offers to you, for just 1.25% add-on-rate a month; you will get a financial assistance to cater your needs”. And he keeps going and going and going, says a lot of blah blah blah. I didn’t mind because I was preoccupied with my own thoughts, saddened from what I have become, worried from what I have done – wasted. And then… (click fingers) what a fantastic idea! I will get a personal loan and pay off my debts. In a zap, the agent took care of everything and after claiming the cash carrying with both of my hands, I exclaimed, “at last! Problem solved.” I paid most of my debts in an instant leaving just about 10% of my total obligations.

But I thought it was over. I thought borrowing money will make other borrowed money solved. I was completely wrong. Why? Because the moment my credit line expanded, I returned to my old spending habits. My debts piled up and became gargantuan collections of billing statements! I guess I should remind myself that paying debt from another debt is suicidal. And imposing financial discipline is very important.

Due to crowded billing charges and mountain of debts from credit cards and loans, I can’t breathe! I need help! I have to discipline myself and target my spending habits. Thank God people came into my life to educate me and provided financial literacy. It was very difficult and cumbersome, but I guess it’s worth it.

Here’s what I have done in reducing some and eliminating most of my personal debts.

1. I cut up my credit cards leaving only two for non-cash transactions.
   
   
2. I come up with 5K to 10K extra a month.
   
   
3. I used the extra money to pay my monthly dues to only one credit card. I will now pay the minimum plus the extra 5K to 10K on that one credit card.
   And I paid the minimum amount due for all the remaining cards. Which surprisingly never get paid off because of the interest accrued?
   
4. When I paid off my first card, I then applied the total amount I am previously paying on that first card to the next credit card. I am now paying the minimum amount due on the second card plus the total monthly payment I am paying on my first card.
   
5. Once I paid off my credit cards, I continued the procedure with my personal loans.

Financial education and literacy elucidates my situation, my spending activities, and the best of my future investments. I swam up and out from my debt drowning. I learned to take control of my cash flow.

If I can do it, you too can do it. You can survive from this clustering community of disguise, pretending to be a good thing but actually it’s not. Do not be fooled. Educate yourself. Get help!