2023-07-13 23:00:06
Putting your financial life in order requires commitment and a change of attitude towards finances. It won’t be exactly quick to get out of debt, but with good planning it is possible to end the debt cycle.
The lack of financial planning is one of the main reasons for the high default rate in the country. According to the latest Serasa Delinquency and Debt Renegotiation Map, Brazil reached 71.9 million indebted families, a total of 44.9% of households in the country. The state of São Paulo is in 10th place in the ranking of defaulters, beating 45.9% of debtors.
The professor of the Accounting course at Anhanguera, Ma. Valéria Vanessa Eduardo, points out that getting out of debt is a difficult task and requires a lot of determination. “Usually the person defaults by keeping the pattern of consumption and spending above their financial capabilities. Obviously, there are exceptions such as unexpected expenses with illness, family, etc., but in all cases, taking care of bills and honoring your commitments is essential”, explains the professor.
Also according to Valéria, the biggest villain in household indebtedness are credit cards, whose average rate is 201% per year and the average percentage of the revolving card (charged from customers who do not settle the entire monthly bill) is 448 % per annum, that is, it is bad credit. “It is important to highlight that 75% of Brazilians pay their purchases in installments, and the credit card has become a way to meet basic needs. However, card defaults reach more than 50%, showing how high interest rates and inflation significantly affect families’ budgets”, he adds.
To avoid debt and achieve financial stability by the end of the year, the specialist suggests some simple and effective strategies: list all debts and contact creditors to negotiate payments, look for fairs that offer discounts of up to 99% for renegotiate your debts and use the 13th salary to amortize these outstanding issues. “It is crucial that debtors only close deals if the conditions are compatible with their financial reality. Breaking the debit contract can lead to the loss of the discounts offered, cancellation of the renegotiation and resumption of interest”.
In addition, the teacher highlights the importance of self-knowledge to avoid new debts. Understanding the reason for purchases, avoiding compulsive purchases, social comparisons, materialism and consumer vulnerability are crucial factors for better financial control. “To balance your income, set aside 50% for essential expenses, such as rent, food and transportation; 30% for lifestyle, such as gym and leisure; and 20% for payment of loans or investments”.
The expert emphasizes the importance of avoiding disorderly use of credit cards and recommends setting clear goals, such as getting out of debt, acquiring a property or taking a trip, to motivate the family to be more financially aware.
To avoid new debts, Valeria offers the following tips:
Have an expense control spreadsheet, including monthly fixed expenses and debit card expenses. Make a list before going to the supermarket, set a fixed date for monthly purchases and research prices. Avoid having too many credit cards, prioritize cash payment and, if you need to pay in installments, choose the number of interest-free installments. Opt for a more economical car and check it regularly to avoid excessive repair costs. Plan outings with an expected average cost and look for free leisure options. Adopt conscious consumption habits to save food, water and energy. When renewing the lease, propose a renegotiation to the landlord and explain your situation. Finally, Valéria advises organizing yourself for seasonal payments in the first quarter of the year, such as IPTU, IPVA and school fees, and using your 13th salary to make reservations, if possible.
“Following these guidelines, it is possible to achieve the desired financial stability”.
Source: Valéria Vanessa Eduardo, professor of the Accounting course at Anhanguera
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