Before we can get to exactly how Plymouth Associates can help you get out of debt, it’s important to understand the big picture of debt afflicting hard-working Americans. This will not only give you a sense of perspective but also help you stop doing all the wrong things, things that could be making your financial situation worse.
America's Debt Crisis
The United States debt is likely to be larger than its economy soon.
Today, millions of Americans struggle to make a living after the massive job losses in 2020. Millennials struggle to pay off their student loan debt while baby boomers can’t afford to retire on social security.
Although the financial distress experienced by Americans due to lockdowns shutting down large sectors of the economy, America’s financial situation started long before COVID-19. The current financial crisis only appears new because our national economic woes are now more difficult to ignore.
In fact, in 2018, the Nation Financial Educators Council conducted a survey that suggested that the root of most financial problems in people’s lives arose from wide-scale financial illiteracy.
Their survey wanted to know how much money respondents thought they had lost because they didn't have enough financial knowledge.
According to the responses they collected, they estimated that "collectively—lack of financial knowledge cost Americans more than $295 Billion dollars in 2018.”
Financial literacy is understanding more about how to manage your personal finances. This knowledge will improve your financial situation. Two of the most important lessons are how to get out of debt and how to increase your income.
How to Get Out of Debt
If you’re like most people, you not only don’t know how to deal with debt but you’re probably making your financial situation worse because you only have a vague notion about how to dig yourself out of the deluge of bills you receive in the mail every month.
The Vague Approach
If you’re working longer and harder at your current job, hoping to make a little extra cash by accepting any overtime shifts regardless of how exhausted you might feel after a long day, you’re unlikely to pay off your debt. And if you’re scrimping and saving your wages, depriving your family of many of the things you need, you’re also unlikely to make a difference.
The reason your debt exceeds your capacity to earn or save is that most of your repayment only covers the interest on your debts. It hardly touches the principal amount you owe.
Since your debt is increasing at a faster rate than you can reduce it because of high interest rates, you are more likely to feel so exhausted that you end up paying late fees as you fall further behind in your repayment efforts.
What’s more, keeping track of what you must pay and when can become overwhelming-- because you must pay different accounts with different amounts at different interest rates on different days of the month. Managing your expenses is almost like working a part-time bookkeeping job.
An Effective Solution
If you spoke to a financial advisor about your debt burden, you might get a different picture of how to pay it off. He or she would suggest that you restructure it.
While there are many ways to restructure debt, one of the most effective is to get a personal loan to pay off all your creditors. Since this loan merges all your payments into a single monthly bill, lenders call these types of personal loans, “consolidated loans."
When it comes to deciding what to look for in a financial service company that offers personal consolidated loans, you should review their policies, talk to a customer service representative to understand how debt restructuring works and review any information you can find about customer satisfaction.
Here at Plymouth Associates, for instance, we will not only tell you how to get and use a consolidated loan to end your debt, but we can also prove to your satisfaction that debt consolidation loans work based on what our customers have said about their experiences.
For instance, Leo, from North Haven, New York, said, “I thought I was on top of things. I really did. But, when my monthly minimums were more than my rent, I had to face the facts. I was in trouble and needed help. Plymouth Associates didn’t judge me, they helped me. They made it easy for me to track. Plymouth Associates offered me an affordable solution. Thank you, Plymouth Associates.”
And Gianna, from Franklin Lakes, New Jersey, commented, “Times are tough. Everyone gets that. But for some reason, I feel like it was tougher for me. I definitely went into my own little bubble and didn’t want to think about money. Well, that was dumb. Plymouth Associates was willing to take a risk on me. They laid it out simply. And, really, I just needed someone to say they could help. Plymouth Associates saved me.”
How a Consolidated Loan Eliminates Debt
A personal consolidated loan is an effective debt restructuring method because you’ll use the money you borrow to pay off all your bills at once. You will now only pay on your loan every month. Suddenly the hassle of keeping up with multiple payments will have gone.
What’s more, you’ll find that repayment is easier and cheaper.
It’s easier because we will work out an agreement with you on how much you can afford to pay every month after you’ve calculated your income and living expenses.
And it’s cheaper because you will typically have a lower interest rate rather than before when you had to cover the combined rates of all your individual debts.
The benefits of consolidating your debts with a personal loan include reducing your interest rates, locking in a lower rate, and making your repayments on a consistent schedule.
A personal loan consolidation will also improve your credit scores because of the reduction in your credit use rate and the increase in your record of making payments on time.
How to Increase Your Income
Another important lesson in personal finance is how to increase your income. It's really not as hard as you might think. One way you can increase your wages by identifying what jobs in your company will pay you more than your current position and then getting the knowledge and skills you need to qualify for that position.
You might be able to acquire the knowledge and skills you need through an in-house training program, or your company might subsidize your education if you go back to school part-time to earn a degree.
Corporations are often willing to pay to educate their employees because they classify these expenses as tax write-offs. Instead of paying taxes, they are investing in an employee who will increase the company’s bottom line. A few are even willing to pay for your MBA.
Acquiring financial literacy will transform your life. Start by learning how to restructure your debt and increase your earnings. After that, the sky's the limit!