Step-by-step ways of Paying off Debts.

By on July 4, 2018

So you have reached a point when you realize there is a need to put your debts in order. You have made a decision that it is that point in time that you want to clear off your debts and embark or real saving and investment.

It is alright to take loans and be in debts. What matters is how you manage your debts and how fast you are in a position to pay them off. We take loans not to use them in luxury, but to invest in something valuable and is worth investing in. 

A point to note, Your debts should not be barriers to paying tithe and saving, which should be 10% of your income each respectively. A compromise only comes in where the debts are more than 10% of your income and you have a plan of paying off the debts within the shortest period possible.

Factors to consider before taking a debt.

  1. Identify the need. Evaluate and ask your self, what is it that is making you want to take a loan, and that cannot be paid off using your daily income. Prioritize each need and find out which one you can forego and which one is very urgent and that will affect your daily activities when not taken into consideration.
  2. Identify a suitable loaner. It can be from a neighbor/friend, bank, Sacco, chama group, Insurance or from your own savings account. Look at the terms and conditions of both and how you have been contributing or saving with them. Evaluate your income and make a decision based on the terms and conditions and your income.
  3. How flexible are you in paying the loan. This is the point where you ask yourself, that if your employment job would end now before finishing to pay off your loan, what are other personal openings that you can use to pay off your debts? That is where savings and contributions come in.

Now you have made a decision to take up debts and you are wondering how or what is the procedure of paying of your debt quickly. Worry not i am with you. You just need to continue reading the article a little bit longer:

Simple ways of repaying debts.

  1. Understand your debts, the terms and conditions you were given when taking the loans. Write each one of them down with a pen and a paper. Prioritize them using the interest rate of each and monthly repayment period.
  2. List your debts according to the most urgent to the least urgent. Identify which one earns more interest and which one has few repayment period. Eliminate the ones with high interest and least repayment period. Once you have classified each, now look at your income and ask yourself which one can you start off with. Is it one with high interest and more repayment period or one with low interest rate and least repayment period?
  3. How much of your monthly/daily income can you use to pay off debt after deducting tithe, savings and your normal expenses.
  4. Minimize your expenses. Try as much as possible to reduce your expenses in order to have an ample time to clear off debts.
  5. Consider Deductions from monthly income. You may decide to agree with your employer to deduct a certain amount of money monthly from your salary to go to one of your prioritized debts directly. This one of the easiest ways of paying off debt since your income gets to you once the minimum monthly debt payment has been deducted already and paid off.
  6. Seek for advise and assistance, from a money expert, or a trusted friend who understands you and can give a genuine advise on an easy way of paying off debts. You can always reach out to me for further advise or appointments at anytime. Feel Free

I hope you enjoyed the read. Let us continue learning, growing and pursuing our finances in order to achieve our dream careers.

See you in the next post.
















































































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Nairobi, Kenya

Hello World, my name is Dorcus Joy Obura(Mpeggyjoy) welcome to the world of financialistas where i impact people's lives with personal/lifestyle finances,world/trends in finances,how to account and manage finances. We all have our financial vision to be wealthy and rich and to be confidence on the decisions we make with our finances. I'm a twenty-two year old lady with the passion for personal finance,world finance and wealth building.i honestly believe that my purpose is to help and serve to their satisfaction,hence helping them grow and develop towards their financial freedom.As a teenager my purpose is to read necessary financial stories and trends and get acquainted to world's finance.I believe this will help me grow and you as well.See the 'About' tab above for additional details.

July 2018
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