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It may be impossible to totally erase debt from your life, particularly if you have made significant commitments like purchasing a home or pursuing further education. However, you may properly manage your debt so that you have more control over your finances. Ensuring that your debts are well-managed will have a long-term positive impact on your credit score.

Here are five suggestions for better debt management:


Analyzing & Recording Spending Habits

Analyzing your spending habits and identifying all unnecessary expenses is the greatest strategy to get debt under control. For one month, keep track of every penny you spend, even if it seems insignificant (like food or movie tickets). You’ll be able to see how much of your expenditure is constant and how much is variable if you do this.

Make a note of all your debt obligations, as well as the interest you’re paying on each one. Put them in order of highest to lowest interest rate. After you’ve completed these steps, it’ll be easy to determine where you can save money.

Obtaining and reviewing your full credit report is a wonderful approach to learn more about your finances, credit health, and credit score.


Reduce The Number Of Extras

Add up all of your expenses and compare the total to your monthly income. Use the additional money to pay off your debts if it is less than what you earn. Figure out which variables you need to cut back on if it surpasses your income.



Find innovative strategies to reduce your household expenses, such as moving to a less expensive neighbourhood or refinancing your mortgage to get a lower interest rate. If you have an excellent payment history, you may be able to persuade your credit card issuer to reduce the interest rates you pay.

Boost Your Earnings

Consider whether there are any ways to increase your earnings, such as compensated overtime hours or working on public holidays. You might also consider additional sources of income, such as coaching, teaching, freelancing employment, or starting an online business.


Pay Off The Debt

Focus on settling the debt with the highest interest rate first once you’ve determined the utmost amount you can afford to pay down each month. This manner, once the debt is paid off, you will save money on high interest rates in the long term.


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Contributed by CTOS

It may not be possible to completely eliminate debt from your life, especially if you have made important investments such as buying a home or pursuing higher education. However, the debt you have can be managed carefully so that you have better control over your finances. Ensuring that your debts are well-managed will also reflect positively on your credit health in the long run.

Here are five tips on how to manage your debt better.


Record your expenses 

The best way to get debt under control is by analysing your spending behaviour and identifying all unnecessary expenses. For one month, record every cent you spend, including what you may consider minor expenses (like food or movie tickets). By doing this, you will be able to see clearly how much of your spending is fixed and how much is variable.

Next, make a list of all your debt obligations and the interest you are charged for each. Put them in order of interest rate, from highest to lowest. Once you have done these steps, it will be easier to see where you can cut down on your expenses.

A good way to know more about your finances, credit health and credit score is to obtain and check your full credit report. For instance, a full MyCTOS Score report will give you a comprehensive insight into all major areas of your credit health and let you know where you stand in the eyes of banks and lenders. Get your free MyCTOS Score report at ctosscorecheck when you register with CTOS.


Cut back on extras

Add up the expenses on the list and compare the amount to your monthly income. If it is less than what you earn, use the extra money as your debt payment. If it exceeds your income, figure out which variables you need to cut back on.


Lower fixed expenses

Find creative ways to lower your household bills, move to an area with cheaper rent or refinance your mortgage to get a lower interest rate. If you have a good payment history, you may ask your credit card company if they would consider lowering the interest rates they charge you.


Increase your income

Consider whether there is any way to boost your income, such as paid overtime hours or public holiday working options. You may also want to think about secondary income generators, such as coaching, teaching, freelance work or running an online business.


Settle the debt 

Once you figure out the maximum amount you can afford to pay off each month, focus on resolving the debt with the highest interest rate first. This way, once the debt is settled, you will save in the long run on high interest rates.


Established in 1990, CTOS is a leading credit reporting agency under the ambit of the Credit Reporting Agencies Act 2010. Its three-digit CTOS Score will show your creditworthiness. It is an evaluation of an individual’s credit history and capability to repay financial obligations. The higher the score, the higher your chances of securing a loan.


Source: Star Property