According to Bankrate’s research, only 39% of Americans could afford to pay cash for a $1,000 emergency expense in January 2021. This is a reduction from a similar survey in February 2020 where 41% of the respondents had savings that could finance an unexpected $1,000 emergency bill. Further, the Economic Well Being of US Households in 2020 survey shows that 36% of US adults cannot pay a $400 emergency using cash as of November 2020.

However, there are companies out there aiming to make a positive impact in people’s lives through professional personalized solutions of debt payment to help people regain control over their financials.

Below are some of the strategies to help you get started.

Get A Card That Suits Your Lifestyle

Perks offered by a credit card company are vital in helping you keep your loan costs low. For instance, if you have a trucking or hauling business and gas costs are one of the key expenditure areas of your business, you should consider a credit arrangement that offers rewards such as redeemable bonus points or a cash-back offer when you fuel your vehicle. There is an array of options covering an array of expenditure areas such as groceries, gym membership, clothing, public transportation, and more.

Most importantly, you need to review your expenditures as you get a card that suits your lifestyle. However, some service-provider or store credit cards have high-interest rates, you should ensure that the interest rates are not above the market average.

Avoid Overspending

Brad Stroh of Freedom Financial Network often cautions consumers to remember credit card can give the illusion you have more money than you actually do. To avoid overspending, always set limits and alerts as well as adopt a holistic lifestyle change such as frugal living when you are surviving on unemployment checks.

Furthermore, most credit cards offer rewards when you hit certain expenditure milestones such as $500, $1,000, and more. You should work around this by ensuring that your card suits your lifestyle as discussed in the first strategy. Above all though, you must maintain a clear financial perspective of the limit you can comfortably fund.

Manage Your Credit Cards

The average US household had four credit cards as of 2020. However, this does not mean that you should also have four credit cards. The key factor in how to manage your credit cards is to only have cards that you need and that are practical for your convenience and financial security. Avoid opening credit accounts ever so often and closing them abruptly as this could be indicative of financial distress or impulsive habits that are deemed risky by lenders.

Your Credit Score Should Reflect Your Statement

If you make your repayments on time and have zero delinquencies, your credit score should reflect your statement. This means that your credit company should be relaying your data to the three strategic credit reference bureaus in the country; Experian, Equifax, and TransUnion.

With an improving credit score, you will be able to get credit at low-interest rates and low fees that can help you save money in the long run. Further, a good credit score can help you secure vital non-revolving loans such as mortgage loans at friendlier terms in the future as well as securing employment opportunities and renting.

Conclusion

Debt distress can weigh you down and derail you from living a fulfilling life. Brad Stroh of Freedom Financial Network can customize for you the strategies highlighted such as managing your credit cards, avoiding overspending, among other tips to have you back on your feet to financial freedom. 

Author

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