A spiral of debt can affect everyone – if we get more and more debt, it can eventually lead to financial ruin. How can you recognize that the threat is real?
Do you like to buy a lot? In this case, there is a risk that the spiral of debt may be a big danger for you. Also people who earn less are more exposed to it, but it is also a problem for those who earn quite large sums.
We should beware of debt spirals – if debts arise, which we will not repay, it is the first step to debt collection, and then, when we also do not indebt, we will have problems with the debt collector. Of course, our data are also entered into various databases of debtors, which in the future will be a big obstacle not only in taking out a loan or credit, as well as the signing of a contract for a subscription. So, how can we recognize that the spiral of debt is a serious threat to us?
1. You want to borrow more and more
You already have one loan, but the money from it is long gone. So you think about taking another one because you do not want to wait until you get a payout. In such a situation, you run the risk of creating a spiral of debt, because there will be more and more loans, and you can have serious problems with paying them off.
If you want to buy something, just wait for the cash flow. Do not take another loan until you repay the one you already have, because then you may run out of money to repay these debts.
2. There is less and less money in your budget
You have a loan or even a few loans and your budget is getting less and less money for various expenses, including everyday ones? This is another symptom that we should not underestimate. If you already have to tighten the belt to keep pay, then the spiral of debt is also getting closer and it may appear unexpectedly – just one more expense, for example a broken fridge.
When you see that you do not have enough money, put in a variety of ways to save money, so that you can lower your real costs. You can also look for other influences. Whenever possible, pay the smallest loans as soon as possible.
3. You tend to make impulsive decisions
If you are a person who makes many decisions, including those related to money, under the influence of the moment, you can also be in a group that will be exposed to the spiral of debt. You buy things that seem good, but then they do not fit and are not needed. You are trying your hand at online investments that do not bring profits. You scribble with money during meetings with friends. It is these actions that can lead you into a spiral of debt when you already have a loan.
So if you want to avoid the unpleasant consequences of the spiral of debt, remember our advice.
Thanks to them, you can reduce this risk and thus pay off your liability without danger. However, if you already have difficulties, it is worth contacting the lenders and explaining the situation to them, as well as start looking for savings and more influence on their own.