Managing debt as a senior

On Behalf of | Jun 1, 2015 | Debt Relief |

Older Texas residents who are struggling with debt may be interested to know there are a number of strategies they can use to reduce those obligations. First, it is necessary for people to understand their finances. Looking at cash flow might reveal places where savings can be made and applied toward paying off the debt instead.

People should also consider how their debts can be prioritized. Barring emergencies such as facing eviction, they should begin by paying down the debt that has the highest interest while paying the minimum on the other debts. Once the highest-interest debt is paid down, they can then begin applying that money toward the lower-interest debts. Individuals looking into debt consolidation should weigh the fees and whether this will represent actually save money.

Another solution might be taking a part-time job to generate income, although those who are receiving Social Security retirement benefits should make sure they are not jeopardized by working. Having a garage sale might be another way to make some extra cash. A reverse mortgage or home equity loan are also options if cash is a necessity, but individuals should check with professionals before going into further debt with these types of arrangements. Finally, some people may want to look into debt counseling, but they should make sure the company is legitimate.

For some, bankruptcy is also an option, but those who are considering this may wish to consult an attorney. There are a number of misconceptions about bankruptcy, and while some people may believe they will lose all their assets or that they will never be able to repair their credit, this is not the case. In fact, bankruptcy may provide a fresh financial start. An attorney can describe the eligibility requirements and how the process works.