How To Make SMART Debt Plans For 2017Dec 21, 2016
If you’ve decided to deal with your debt in the new year, you are certainly not alone. Debt plans are likely on the minds of many B.C. families. With the most recent debt to income ratio reaching a record 167 per cent and the average consumer debt amount in British Columbia at approximately $23,000, creating plans to reduce debt is likely on tap for many in 2017.
Setting debt relief as an intention is only the first step. It can be tough to determine the next steps you will need to take in order to make this happen, and it’s tempting to get discouraged if your debt plans get sidetracked. In order to make the process less intimidating and likely more successful, it’s important to be SMART about the debt plans you make.
Being SMART means creating SMART goals. SMART goals are goals that are specific, can be tracked and measured, are achievable, are realistic and also include a time-frame in which to complete. SMART goals work well because they not only provide you with the detail and guidance you need, they also help to keep you accountable and on track.
Say, for instance, you want to incorporate the goal of reducing your credit card debt into your debt plans for 2017. Instead of merely adding this to your list of resolutions, SMART goals force you to stop and consider the finer details involved. Be specific. Do you want to pay a set amount, or pay off one of your credit cards? In terms of measurement, you would need to include the exact amount or percentage of debt you would like to decrease. You would also need to outline and break down the necessary steps, such as loan consolidation, in order to make this goal achievable. The final step would be Determine whether your goal is actually realistic given the parameters you’ve defined. Finally, a time-frame in which you plan to accomplish this goal is necessary.
Creating SMART goals can be a little tricky, particularly if you are feeling overwhelmed by the amount of debt you carry. In order to ensure that you are successful in completing your debt relief goals, it may be necessary to seek extra support.
You might want to speak to a debt relief professional, such as a credit counsellor or Licensed Insolvency Trustee (LIT). Debt relief professionals can provide you with support and guidance as you work towards finding relief from your debt. They will also work to understand your specific financial situation, goals and needs in order to help you create a debt plan that you can stick to. Or you might want to start with some DIY online research. This could include increasing your financial literacy knowledge and skills by researching debt relief strategies and tips through an online resource, such as the Financial Consumer Agency of Canada’s Financial Literacy Database or other personal finance websites like Practical Money Skills Canada and Get Smarter About Money.
Setting a goal for yourself to find debt relief in 2017 is a great way to work towards financial stability and balance and avoid encountering future financial problems. This is particularly true when you incorporate SMART goals and seek help if needed.
What are your SMART financial goals for the new year? Join the conversation and share them with BDO Salmon Arm using the hashtag #BDODebtRelief.