There is Yoruba adage my father used to say – “áwolu ma té mo wan árá re” meaning that everyone should know his or her limit. Because, most individuals are financially undisciplined we get into unnecessary or bad debts. With the present banking reforms by the CBN most of our so called richmen are having sleepless nights over debts they owe banks, most of them are presently being harassed by the Economic and Financial Crimes Commission (EFCC) while some are actually cooling off in EFCC detention. In this article I’ll be discussing tips or ways of controlling or curbing personal debts.
A debt is that which is owed; usually referencing assets owed, but the term can also cover moral obligations and other interactions not requiring money. In the course of this article we will be looking at monetary or financial debts.
It is important to control debt so that the individuals do not end up with large amounts of debt later on in the future. Most individuals want to know how to control debt in the beginning so that they can save money and not waste money. Here are ten tips on controlling debt:
• Individuals should only spend what they can afford to when they make a purchase. They should not imbibe the habit of always hoping to pay off in the future.
• Individuals should often find out whether they really need a certain item or service. There is a difference between “a want and a need”. An item that you want is something that can be purchased later when you can afford it. An item an individual needs is something that should be top priority over the want item.
• Individuals should as much as possible try to save up enough money in order to pay for an item. They should not charge an item on their reserve each month. It will just end up racking up debt that they perhaps cannot afford to pay off in full each month.
• If Individuals need to take loan then they should make sure to pay it off as soon as possible.
• Individuals should not get stuck into automobile loan. Automobile loans are usually are not worth it since the vehicle loses money value each year i.e. depreciation. Individuals should only buy vehicles that they can afford without an automobile loan.
• Individuals should not borrow money from people unless it is an emergency. Individuals would ordinarily not want to borrow money that they do not really need. If an individual borrows money he/she should make sure to pay it back as soon as possible.
• Individuals should always take out time to think about a purchase before following through with it. A few weeks or months will be an ample time for them to figure out whether they really need the item or not. Individuals should not buy stuff on impulse.
• Make sure to always have some money put away in savings so you won’t go into debt as much. Only use the money in savings when it is a true emergency. Don’t consider the money in savings as regular household money each month that can be spent.
• Individuals should not go over their monthly budget. They should try as much as possible to follow the planned monthly budget so that they do not create more debt time. It is important for individuals to stay out of debt as much as possible and a budget will help them stay spending only on what they can afford.
On the final note, I’ll advise individuals to learn to cut their coat according to their size, save, invest and learn to be financially disciplined to avoid being tied down by the burden of debts.
Onakomaiya Adekunle .O.
onokok@yahoo.com
