Are you in default? How to plan to get out of debt.

Poor money management. It sounds unpleasant, and you probably don't want anything to do with it. However, a large portion of Brazilians don't manage their money properly. At the beginning of 2019, 60% of the population was in default, according to data from the National Confederation of Commerce (CNC). Of these, 9,1% said they didn't have the money to pay their debts and that they would remain indebted.

Still, there is hope for you if you find yourself in this group. Besides being able to bet on... Mega WeekThere are some strategies you can learn to manage your money the right way. Having a good money management plan can be the light at the end of the tunnel for people trying to get their finances in order. These are the first steps in effective money management.

1. Create a budget

Starting from the beginning: create a budget if you haven't already. Creating and sticking to a budget may seem a little difficult to achieve at first, but it's worth it in the end. It helps us see our financial situation clearly and transparently, and it's the first step in helping us pay off debts and start saving for future expenses, such as a loan, a car, or retirement.

2. Understand your expenses.

Many people don't know the total amount of expenses they incur in a given month. This is a problem, but there's an easy solution. Track all your expenses for a month. Gather all your receipts (groceries, restaurant bills, utilities, etc.), examine your bank statements, and add up all your expenses. Remember to keep track of expenses paid in cash as well as credit cards.

The idea is to have all your expenses accounted for to obtain a total value. This will allow you to see the big picture and know how to manage your expenses going forward. You will be able to compare your performance over time and identify those superfluous expenses that can be cut.

3. Understand your income.

This is the difference between income and expenses: most people know their total monthly income, but have less knowledge of their expenses. However, the goal is to find out your total expenses and subtract that from your total income for the month in question.

If you end up with a negative number, it means you spent more than you earned. Reduce your spending and expenses until the total reaches zero. If you end up with a positive number, it means you spent less than you earned. In that case, you could increase your savings.

4. Consolidate your debt.

Nobody likes debt, and most people who need help managing their money usually struggle with it. The first thing to do is get your debt under control and work towards getting rid of it. If you have credit card debt, student loans, or other debts, try consolidating them into one and try to get the lowest interest rate possible.

If you only have a single credit card debt and are on a tight budget, try to pay at least the minimum amount as soon as you receive the bill. Then, if your finances allow, and you find some extra money, try making the same payment a few weeks later. Maintain this payment cycle until your debt is fully paid off.