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Tips for young people looking to get out of debt

Millennials in Kentucky and elsewhere typically carry student loan debt of $40,000 in addition to other long-term repayment obligations. Repaying that debt in a timely manner may make it easier to build a stronger financial future. The first step to getting out of debt is acknowledging that it exists. This may be done by listing existing credit card, student loan or other debts.

By getting a clearer picture of what is owed and who is owed, it may be easier to determine how well an individual is actually keeping up with their monthly payments. From there, one can create a budget or debt repayment plan that fits their needs and current financial situation. At the very least, an individual should make plans to pay the minimum payment each month on all outstanding debt balances. If a person can afford it, they should also make additional payments each month.

Debit cards are generally preferable to credit cards as they will keep account holders from accumulating too much debt. However, debit cards don't offer the same protections that credit card do, and some retailers may place holds on a debit card until a transaction clears. Therefore, it may a good idea to keep cash on hand or use a credit card for online transactions.

Those who are struggling with debt may wish to file for Chapter 7 bankruptcy. This is known as a liquidation bankruptcy, and it can be helpful for those who are looking to get a better handle on credit card or other unsecured debts. In some cases, entire balances may be discharged in a matter of weeks. An attorney may be helpful in explaining the concept of discharging debt as well as other benefits of filing for bankruptcy such as an automatic stay against creditor action.

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