New year. New decade. Merry Debtmas.

Merry Debtmas… It’s that time of year once again…

It’s the same merry debtmas but in a different decade. You may have overspent this holiday season, so opening those bills won’t be pleasant. Rather than let it ruin your new year, we have some tips to help you alleviate your debt. Merry Debtmas.

The first step in reducing your debt (and keeping your 2020 on track) is to start with a plan. You should take a look at your total debt and monthly expenses and understand your cash flow. Your cash flow is the amount coming in and going out each month. This can be as simple as writing the numbers out by hand or by creating a fancy Excel spreadsheet. Once you get a handle on how much you owe, your monthly payments, and what you have leftover, you can start to explore ways to reduce your debt.

Your mortgage might be the solution…

Did you know that your home can help you save thousands of dollars this year?

Your house is an asset and we consider it good debt. This contrasts with unsecured debt such as credit cards, lines of credit, and loans. In many cases, unsecured debt is considered bad debt, especially if you are carrying balances at high-interest rates.

Did you know that when you refinance your home you can roll higher-interest debt into your home at much lower mortgage rates? By reducing the amount of interest you are paying on unsecured debt you can apply more to the principal balance and become debt-free sooner! We can help you finance your unsecured debt by leveraging up to 80 per cent of the market value of your home. To look at more reasons why refinancing will help you have a good new year, check out some of our other posts here.

It’s time to get back to 2020

There are a few other things that you can do to help alleviate the stress of Debtmas. Once you have your cash flow written down you can start to create a budget. By creating, and sticking to, a budget you can start to chip away at your debt and reduce the amount of interest you will end up paying in the process. Saving a few dollars each day by making a coffee at home can help you become debt-free sooner, and we think you will like that a latte. If you need some help making a budget you can check out our post on that here.

Don’t let debt get the best of you in 2020! Get in touch with us here and we can help you with your financial future!