Debt is mainly the result of excessive consumption or ill-considered financial habits. Debt, a financial set back, results in stress to the individual and his/her family amongst many others.

But there are some basic tips to get out of debt as listed below:

1. Analyze historic financial expenses

Knowing your past is the best way not to repeat the same mistakes. Pull out your account statements and list your expenses over the past few months. Next, identify consumption patterns that need to be reviewed.

2. Prepare budget

Simplicity is the key to success: expenses are deducted from income. Avoid dividing your expenses into multiple categories. The more complex it is, the more likely it will be left out.

3. Be honest and realistic

You must accept the fact that changes to the monthly budget are necessary from time to time. Distinguish essential expenses that do not change every month (rent, gas, etc.) from those that can be reduced or eliminated (unused subscriptions, dining out) and unexpected expenses.

However, a budget that is too strict often leads to abandonment. Determine a realistic monthly amount for debt repayment. It is better to take your time and be consistent than to rush everything and get discouraged.

4. Track your budget

Mobile applications can make your job easier, but regardless of the tool, periodic monitoring helps you control expenses and avoid returning to bad habits.

5. Establish an adapted game plan

Generally, it is best to pay high interest rate debt first. Whatever the balance, they cost the most. However, don’t neglect the psychological aspect of a repayment plan. If for any reason, a debt bothers you, prioritize it.

In all cases, it is suggested that you focus on one debt at a time, while making sure you make the minimum payments on the others.

6. Consider loan consolidation

Increased debt can be a source of stress. Loan consolidation makes it possible to group them together in a single loan, which greatly facilitates budgetary management.

However, it can have a negative impact on your credit score and you may be required to permanently close the financing accounts it covers. The credit associated with these accounts would therefore no longer be available to you, which is not necessarily a bad thing if you try to get out of debt.

7. Choose an appropriate limit

Once you have reached a more comfortable debt level, avoid returning to your bad habits by keeping your credit limit below your monthly income.

8. Generate a secondary source of income

If your conditions allow, temporary income support is a sacrifice that may be worth the cost. But be careful not to do this at the expense of your health.

9. Put on sale what is no longer used to repay debts

Getting rid of things is never easy. But it’s a way to get some money back and reduce debt.

10. Do not isolate yourself

There is no embarrassment in wanting to take charge of your finances. Talking about it openly can offer some relief and moral support. It is the same with your financial security advisor who could propose practical solutions to get you out.