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How Technology is Helping Ease The Pain of Financial Hardship
Technology

How Technology is Helping Ease The Pain of Financial Hardship

Pain of Financial Hardship

The task of managing our finances can be a tricky one, especially with the numerous small financial demands that bedevil our society. This becomes even more difficult when an individual is experiencing financial hardship. But there’s no need to worry. The boom of technology has created numerous options that one can explore to mitigate the pain experienced in a financial crisis.

Although there are leagues of technology options to ease the pain of financial hardship, we’ll center our focus on only budgeting, debt relief options calculators, and platforms to prioritize debt.

Debt Relief Options Calculator

There are lots of articles on the internet that you can read to help you make an educated decision about your financial predicament. However, I believe that an apt and straightforward way to get the correct information is by making use of a debt relief calculator.

You can easily find multiple debt relief calculators out there, but one that I’ll recommend is Ascend Finance’s bankruptcy calculator.

Pros of using a debt relief calculator

For those that may be asking that what are the benefits of using a debt relief calculator? How does this assist me? Can’t I simply get information online?. While it may be true that there are lots of information online, the probability of coming across apt information is very slim. A debt relief calculator offers the simplest and easiest means to access the right decision about your financial hardship.

The debt relief calculator works by asking that you fill in some details, after which it’ll bring out some options that best suit your predicament. You will see the pros and cons of all options available, as well as the next step to take.

Prioritize Your Debts

Without having an apt understanding and enough information on how paying off debt works, it’s practically impossible to create a workable plan. As such, you should carry out some research to tackle your debt.

To make it easier to prioritize your debt payoff , you should adopt some effective methods for doing that. Here are some of the methods:

Avalanche Method

One of the effective ways to prioritize a debt is via the avalanche debt payoff method. The avalanche method works by prioritizing debt with the highest interests before moving to the next highest till all the debts are paid. The major benefit here is that you’ll save money on interest payments.

However, just like everything, it has its own con. And this is that the interest on some smaller debts may grow overtime till high-interest debts are paid off. Let’s assume you have a debt that’s worth $10,000, and it has the highest interest rate amongst your debt. If you have three other debs that are $3000 each, then you’ll be letting the smaller debt to grow while you’re paying the high interest-rate debt. By the time you’re paying off the large interest rate debt, the smaller amount will have been higher than expected.

Snowball Method

Another route for dealing with debt is the snowball debt payoff method. This method is the exact opposite of the avalanche method. In its most basic definition, it involves paying off debt from the smallest sum to the largest sum of money. It doesn’t take the interest rate on the debt into account.

A major benefit of this method is that you’ll be motivated to keep paying because of the early successes. However, a disadvantage here is that you’ll ignore a high debt amount with high-interest rates, which will make you pay more than necessary.

Savvy Debt Payoff Method

Lastly, the Savvy Debt Payoff Method is another method of prioritizing debts, and it has some testimonials of successes. It’s a very effective option as it employs different parts of the Snowball and avalanche method.

Savvy has its own algorithm for determining the debt to pay and when they’re best paid. Also, the Savvy payoff method will give you suggestions on where to put any extra cash you have.

With the Savvy Debt Payoff method, you’ll be motivated to keep paying off your debt with the Snowball method. It’ll also use the Avalanche method to ensure that you don’t pay more than necessary.

Budgeting

Lastly, we’ll take a dive into how you can use budgeting to ease the pain of your financial hardship. You can either choose the offline method of budgeting or the online method. The offline method often involves the binder system or the envelope system, but they both have numerous flaws. Let’s go into more details of offline budgeting:

Budgeting Offline

Budgeting offline has a major flaw, which is that you’re not giving your money the opportunity to grow. Of course, it’s possible that the money on the account is so low that the interest rate will have an irrelevant effect on it. But it’ll still add to the money in your account—something that is impossible offline.

The next disadvantage is that your money is neither safe nor insured. For example, if someone stole the wallet that has your credit or debit card, you can keep your money safe by freezing your account. But if you lose your envelope full of cash, then your money is gone.

However, using an offline system also has its own benefits. One such is that it makes it difficult for people to spend above their budget. If you’re out of budget on your entertainment envelope, you’ll see that and won’t be able to spend any amount above the budget. This way, you’ll see the exact amount that’s left in a category.

Budgeting Online

Budgeting online makes the process of managing your money during financial hardship an easy and convenient one. And there are numerous ways to make a budget online, some of which include; Quicken, excel, and phone applications. Excel provides you with a simple and free way to track and manage your finances. You can make use of free excel templates to track the directions of funds in your account.

Quicken is very effective in making a budget online, but I’m not certain that it’s more effective than using excel spreadsheets. The effectiveness of each method depends on the individual using the method. However, Quicken is a good way to figure out your bottom line.

A disadvantage with this method is that you can only use it on your phone, and it can’t be used on the desktop.

In Summary

Technology is proving to be an “effective medication” for financial hardship. And one of those solutions is the debt relief calculator. But it’s not all debt relief calculators that provide noteworthy solutions; that’s why you should stick with debt relief calculator by Ascend Finance.

If you’re thinking of a debt payout method that will be effective, I’ll suggest that you opt for the Savvy debt payoff planner as the best debt payoff app in 2021 .

Lastly, when it comes to budgeting, there’s no right or wrong way to get things done; you have to find that method that works for you.

I believe that this article has educated you on the options you have to tackle your debt, and you now know the one that best suits you.

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