Through its effects, the current coronavirus pandemic has plunged many French people into a difficult financial situation. Placed on partial unemployment, some have seen their income decrease, others have even lost their jobs. As for the independents, confinement has seriously reduced their turnover. To deal with this delicate context, and avoid over-indebtedness, there are however several solutions.
Credits: possible arrangements
The monthly payments of one or more credits weigh heavily on a more limited budget than usual. In this case, you can meet your banker. It is possible that, in this situation of health crisis, it is agrees to change the terms of your credit.
Thus, you may get a reduction in the amount of your monthly payments. To obtain this facility, it must nevertheless be provided for in the contract. This is a long-term solution, which will allow you to bring your budget back into balance. Of course, the duration of the credit will be a little longer.
You can also obtain the temporary suspension of the payment of your monthly payments. It is likely that this payment facility will be more readily granted by banks aware of the difficulties into which the health crisis is plunging their customers.
This solution makes it possible to cope with an unexpected drop in income, but it entails the payment of additional interest.
The grouping of credits
It is also possible to consolidate your consumer loans to avoid over-indebtedness. This solution is intended for people who have taken out consumer credit and at least one other credit, whether this (or these) is real estate or consumption.
What does this credit redemption consist of? The bank buys back the credits you have taken out with several establishments. Therefore, it is she who, in the first instance, reimburses your creditors.
This done, it grants you a new loan with, as a general rule, a better interest rate. From now on, you only have one credit and one monthly installment to pay, which is less burdensome for your budget.
This process is undertaken within your bank. But nothing prevents you from competing and choosing the institution that offers you the best borrowing conditions.
Take advantage of this consolidation of credits to take stock of your insurance, if you have taken out one. Indeed, it is not compulsory for the subscription of a consumer credit for example. But she is highly recommended. Indeed, in case of difficulty, it is the insurance that takes over and pays the monthly payments for you.
Read also: Repurchase of credit: the conditions to be respected to subscribe to it
Better manage your budget
To avoid over-indebtedness linked to the consequences of the health crisis, it is necessary respect a very simple principle : do not spend more than your income. For this, it is necessary to reduce its expenses and expenses.
Some are incompressible, such as rent or taxes. It is also not advisable to choose insurance formulas, for health, housing or car, which bring you less guarantees. Of course, you save on contributions, but you expose yourself, in the event of problems, to much greater expenses.
Nevertheless, it is always possible to lower the water or electricity bill. Taking showers rather than baths, turning off the electricity in a room you are leaving or your various appliances, are all ways to achieve this. Likewise, to reduce your food expenses, know how to take advantage of promotions.
Even if you can indulge yourself from time to time, you must avoid impulse buying. If your cupboards are full, avoid giving in to temptation every time you walk past a clothing store.
Is your sofa showing its age? Rather than replacing it immediately, cover it with a becoming adornment. This will give it a second life. Similarly, if you have one or more credits in progress, it is hardly reasonable to contract others. Especially if their purpose is to repay your current loans. You would then enter a vicious circle that leads straight to over-indebtedness.
In general, it is not prudent to go into debt beyond a certain threshold. To avoid over-indebtedness, make sure that the monthly payments of your loans do not exceed one third of your income.
To manage your budget and avoid over-indebtedness, you should also have a clear idea of your main expenses. Knowing them is a first step towards mastering them. In order not to forget any, it is best to draw up a list of these expenses, with an amount not to be exceeded.
It is then necessary to strive for a certain discipline. Establishing this table is a essential first step. It is still necessary not to exceed the amount provided for each expense. To remind you of this imperative, place your income next to your expenses on the table.
Furthermore, it is useful to consult your accounts on a regular basis. Each time, you will have an accurate balance sheet of your budget. These frequent checks will allow you to notice any deviations and to balance the balance of your budget in time.
Managing your budget better also means putting money aside. It is therefore advised to saveeach month for example, sums that will allow you to meet unforeseen expenses.