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How to Prevent and Deal with Debt Crisis



Image courtesy of Stuart Miles at FreeDigitalPhotos.net


Are you having difficulties managing your debt ? Are you feeling overwhelmed by debt? Do you want to prevent debt problems? If you answered yes to any of the questions then you are reading the right article. If you are feeling overwhelmed by debt, read my earlier  post "Emotional Health: A trendy thing in business" . It will help you. The Quran is a cure for diseases and illnesses for Muslims. " We send down the Quran as a healing and mercy for the believers, but it only increases the wrongdoers in loss." Quran 17.82

For you to be able to deal with daily tasks you need to have a good relationship with Allah (SWT). No debt difficulty is unresolvable, it might not be resolved immediately but you can be rest assured it can be dealt with. In the UK, if your debt is up to £5000 or above they have a government scheme that can help you write off up to 80% of your debt. While in USA, they also have so many debt relief option schemes. So your first step will be to check your country for schemes that will help clear part of your debt. The next step is to stop digging, do not incur additional debts. JUST STOP!, then reduce your spendings, yes I know you are used to a particular lifestyle. It's just till you are able to turn your negative figures to positive ones. Now look for another source of income, you could get another job and the income from it should go strictly towards your debt. For developing and under-developed countries where the unemployment rate is higher start selling something that requires little money to execute. Little drops of water makes a might ocean. 

For individuals that are not in any debt crisis and want to prevent it. Do not spend money you don't have. Someone once told me about borrowing money to give a friend, don't create financial problems for yourself by trying to help someone but you can talk to someone to help another person. The person did not want to give out the money but just did not know how to say no. Helping people is a good thing, but it should always be within your capacity. If you do not have the capacity to give say No, the people that truly care about you will stay with you no matter your response. Giving out anything should be for the sake of Allah. Some people would not want others to think they cannot afford the money and then they get into a psychological state of wanting to prove themselves, please be true to yourself and just because you don't have today does not mean you may not have tomorrow so let it go let them think you are broke. It will do you more harm than good to give out money you do not have. After receiving your income save (halal account) at least 1/3 of it before you spend it. 

Always make a financial plan for at least 3 months say insha Allah (if Allah wills), in your plan make room for unexpected expenses. It is known that people who make long term financial plans are more successful at managing their finances. Stick to the plan. Have a financial goal, like I will save $500 monthly and you can renew your goal bi-annually or annually. Cut your clothes according to your size, thus, do not live above your means if anything live below it, that way an occurrence of a financial challenge (for example adverse changes in source of income), you will have the ability to cope well, since you are used to a standard of living below your income. Diversify your investment (never put your eggs in one basket). Always pay the religious obligatory payment (zakat) when due, you will get blessed for it. Give charity (sadaqa) a lot of it (its not obligatory), Allah loves charity and He will multiply your money when you give charity. Hope you have gained a thing or two. Check this blog regularly for a post on what your budget should look like. Cheers!

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