5 tips on how to manage debt and stay on budget

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Many people have the problem of managing debt to the extent of creating more debts on top of others.

Youths or young adults are victims of bad debt resulting from mismanagement of income.

Many Kenyans have in the past years been listed on CRB for defaulting to pay loans.

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The rise in loan companies with little or no control of who can borrow has landed many Kenyans in debt.

Managing your debt and bills can be hard to many but here are five ways that can help you manage them well.

  1. Create a bill calendar
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Having to know when and who to pay at a particular time is important in managing debts.

Write down your priorities and what is important off your shoulders.

2. Know who/how much you owe

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Make a list of everyone or anything that needs your money.

If it is a bank or house rent, identify the one which is intermediate and give it first slot.

Write down the amount you have to pay for each entity per month.

3. Pay debts on time

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There is nothing confusing like paying debts on the second week or third after getting your salary.

Some end up squandering all money because of failing to pay debts on time.

If your salary or earnings comes every 1st of the month, then it is always best to pay them on the same week before date 5th.

In this way, you will learn how to cope up with your own money without having to worry on the creditors.

4. At least pay any minimum amount

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One way to reduce vast loans or debts is to pay small.

For instance, if you have a loan of Ksh 10,000 then a monthly payment of at least KSH 500 can save a lot and reduce it from accumulating.

5. Make a monthly budget

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Make yourself a budget that will see you the whole month.

From rent, food, transport, and medication, you can clearly identify how much you spend every month.

Because some expenses are compulsory, it is good to know what extra cash from your income can you use to pay your debts without having to borrow again.

In this way, you will be able to pay your debts with ease and still maintain a normal life.

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