Helpful Advice When You Want to Digitally Manage Your DebtDec 06, 2016
If you have multiple debts, chances are you keep tabs on how much you owe via the monthly credit card and loan statements you receive. Especially if you haven’t fully embraced newer digital payment technologies and financial apps. As the world transitions to digital payment technology through tap cards and mobile devices, how can you keep your focus on reducing those debt numbers? Below you’ll find some helpful advice for managing your debt in a digital world.
There are many benefits to being digitally connected, including the ability to track spending and see your debt load in real-time; no more waiting for the monthly statements to receive details of what you spent. Going to a cash-only lifestyle is a common piece of advice for those struggling with debt, but you have to find what works best for you. If that means doing everything digitally and you are prepared to manage it effectively, go for it.
If you’re transitioning to managing your finances online and adapting to newer mobile payment technologies here are a few things you should keep in mind:
- You still need a debt repayment plan.
As part of your monthly budget, remember to continue to allocate money for debt repayment. Whenever possible, make more than the minimum monthly payment amounts. Managing your money online means that you can quickly pay bills or transfer money between accounts at any time, day or night. Try paying all or as many of your monthly bills with the first pay you receive each month; leaving enough living expenses to get you through to the next paycheque. By paying your bills first, you are reducing the chance of overspending or missed bill payments.
- Digital doesn’t have to lead to credit card debt.
In the past, credit cards ruled online shopping, but now as more and more people pay for items in store and online with mobile devices or tap-enabled cards you can hook it up directly to your bank account or debit card. That means you can leave the credit cards at home and out of your digital wallet and enjoy the convenience of digital payment options — without increasing your credit debt. If you use a credit card for travel or rewards points try developing the habit of transferring money onto the credit card immediately after making the purchase through your banking app.
- Keep tabs on your digital spending.
There’s no question that going digital is simple and convenient. A quick tap of your card or swipe of your smartphone and your purchase is complete. It can be easy to forget that you’re spending your hard-earned money. That’s why it’s doubly important to keep tabs on your spending when you’re going cashless. You don’t want to undermine your debt reduction efforts by inadvertently overspending online. Financial apps like Mint or Wally can help you keep track of your digital spending and check it against your budget in real time.
If going digital has already impacted your spending habits or increased your debt load, don’t wait to seek debt help. You can start by looking for information online; the Financial Consumer Agency of Canada website provides common sense information on dealing with your debt. You can also seek debt advice from a debt relief professional. A Licensed Insolvency Trustee can assist you in developing an appropriate plan to get your debt under control. This can include debt consolidation, credit counselling, consumer proposals or other debt relief options that meet the needs of your situation.
The dawning of the digital payment age has made it easier than ever to make purchases without needing cash on hand. The same conveniences found in digital payments can be applied to the management of debt. It’s now easier than ever to make debt payments and stay on top of spending. Good advice would be to stick to your monthly budget, monitor your spending and focus on debt repayment goals — it shouldn’t matter if you choose to do it with cash or go all digital.
Join the conversation using #LetsTalkDebt and share how you keep on top of your debt repayments.