7 Tips to Manage Your Debts Wisely

Dealing with financial problems is hard, especially if you do not know the most effective way of solving them.

If you’re in a tough financial situation now and you’re buried in debt, do not panic. It is best that you have a clear mind when tackling such an endeavor.

To help ease your pain, I am going to go over some useful tips so that you can manage your debts more wisely.

  1.    Have a Detailed List of All of Your Debts

The first thing you should do is to have a detailed list of all of your debts. This is so that you will know which ones to pay off first and which ones you can hold off for now.

You can get your credit history from various financial institutions. Make sure to go over them to see if there are any errors in calculation. You would be surprised that there might be some entries that shouldn’t be there in the first place.

  1.    Prioritize Them

If you have more than one debt, it is best that you prioritize them. First, you have to put them in different classifications like Secured and Unsecured debts.

Second, know which ones have higher interest rates and which ones are nearly due. This is so that you will know which ones you need to be focusing your efforts on paying first.

I advise paying off the ones with higher interest rates first and then pay the ones that

are secured loans. For the people who do not know, secured loans are the ones that have one of your properties tied to it, like a home or a car.

Failure to make the necessary payments would result in the lender having the rights to that property, which I am pretty sure is something that you do not want.

  1.    Pay the Minimum

Certain debts require you to pay a minimum amount every month until you pay it off completely. If you’re struggling with money, it is best that you make, at least, the minimum payment so as to not have any problems with regards to the interest rate.

  1.    Debt Consolidation

If you have a lot of debts that you need to pay and you’re struggling to make ends meet just to pay them off, then you might want to consider debt consolidation.

Consolidating all of your debts into one account is better and give you benefits like tax advantages and a much lower interest rate.

A personal loan or a cash advance would be effective in dealing with debt consolidation since getting them is much easier compared to other loan options.

For further advice, you may want to consult with a debt consolidation agency.

  1.    Always Have a Budget

Part of the reason why people have debts is that they do not know how to properly budget their salaries.

If you are the type of person who doesn’t know how to budget their money, then it is time to turn on a new leaf.

When you create your list, make sure to put all of your important expenses like utilities, food, etc. Put a little bit for some leisurely expenses and spare some for emergencies and repairs.

  1.    Create an Emergency Fund

It is always best that you create an emergency fund that you can tap into whenever accidents occur. After all, accidents happen at inopportune times.

Just remember that this fund should only be used when there are actual emergencies. It also helps that you keep this said fund in a separate account so that you will not be tempted to use it for just about anything else.

  1.    Do Not Bury Yourself Even Further in Debt

People who have plenty of debts to pay off usually do not know how to manage properly and, thus, they end up burying themselves even more in debt.

Make the necessary lifestyle changes. If you were constantly living beyond your means, then it is best that you change that.

Having healthy financial habits will make you deal with fewer debts and more money.


Most of us all have debts, but there are some people who know how to manage them correctly. The tips that were outlined in this article will surely help you if you’re in a tough situation where you need to pay off more than one debt.