Sunday, August 2, 2009

Seven Techniques to Survive Severe Debt Problems

Here is the guest post that I promised you. It is one in a series being submitted on debt management by an excellent author and friend. I'm sure you will find this series informative and interesting. To view my regular articles, click "older posts" at the bottom right, select articles from the archives in the sidebar on left, or do a search in the google search bar in the top of the sidebar. Please take the poll while here, also in the top of the sidebar. Tune in for the other articles in the rest of the series coming soon to get the complete story from Emily Scott. So,here it is. Enjoy:

Seven Techniques to Survive Severe Debt Problems

With the troubled state of global economy, more and more people are suffering from intolerable debt burdens. If you are going through severe debt problems, you must take time to realize the causes and know how to figure out a solution.

The three main reasons for severe debt problems are unforeseen medical expenses, unemployment and divorce. There is a variety of other reasons of major debt problems comprising everything starting from college education to gambling. Though going for college education is an important investment, it is a shocking fact that average graduates begin adulthood with a student loan debt of around $22,700. In the domain of gambling, according to the New York Times, the amount of debt acquired by an average problem gambler in 2004 is $17,000 with an average income of $35,000.

Though people cannot get rid of unpredicted events all the time, they can follow particular techniques to reduce the chance of serious debt problems:

Consider options: Higher education is a valuable investment, but how to get it is important. A lot of students can minimize expenses by staying at home at the time of going to school or going to a reasonable community college for a period of two years and subsequently shifting to a more reputable four-year college.

Plan beforehand with insurance: Prior to the occurrence of a health condition, try to get the most suitable insurance policy. Once you pay the deductible, you should look for a high lifetime coverage with maximum benefits. One expensive sickness can wipe out up to $1 million before you understand it.

Know the truth: If you have debts that are escalating as a result of an injury or severe illness that accumulates hospital bills or makes you jobless, gather all your bills to precisely know how much you’re obliged to pay. Then question every creditor regarding payment plans.

Rescale your standard of living: Even though you expect that you would shortly pick up from a financial hardship like divorce, unemployment or a severe illness, instantly rescale your standards of living so that you can live within your present means. Don’t pile up needless debt through intending to pay it off with tomorrow’s income.

Get rid of harmful habits: If you feel that you have an addiction towards gambling, you must know that your leisure can destroy you. Take advices from your doctor or look for other resources to settle what can turn out to be a severe trouble for you.

Pay important bills in the beginning: The most significant payment that you should make is your mortgage payment. If you lag behind on this, your home can be taken away. Subsequently, prioritize other forms of secured debt like an automobile loan and other unsecured debts like credit card debt.

Select debt help cautiously: If you can’t solve your problems with your creditors on your own and require professional assistance to carry out negotiations on your behalf, make sure that you work with a prestigious debt settlement company. Look out for hidden costs.

Suffering from a huge amount of debt can be intimidating. If you’re unable to handle debt or other difficulties single-handedly, think about looking for assistance. No matter what way you go to get out of debt and move ahead in life, understand that you’re not the only one. With time and endeavor, you can have a promising future.


  1. Hey! :) This was a very informative post. I am so grateful than at this moment I can say that I have no debt on my shoulders. But still, this is big help for the future :)

    Keep on writing,


  2. Fantastic tips. Thank you.

    Health insurance - my family and Fiance thought I was wasting money when over 1 year ago I bought a $500,000 life insurance policy. They don't know. I kept saying that I didn't want to wait to be diagnosed with health problems before applying. I had been seeing Doctors for over 15 years to try to help me. Now, I have several diagnoses. If I tried to get life insurance now, I couldn't even imagine how much I would be paying for the same policy. Good health $50 a month, with Fibromyalgia - who know the cost. A lot more though.

    Life insurance is an important thing to get before something goes wrong. Protect your family.

  3. Thank you both. And thanks for joining as a follower, Tricia. Hope everything works out. Check back today or tomorrow for the next in this series of articles. Please take the poll at the top, left.