The debt collection firm's best advice: How to become debt-free in 2022

Many Danish families feel constrained by financial difficulties and find that their expenses exceed their income. There can be many reasons for this—ranging from a lack of income to poor financial decisions or debt—and often, that debt is costly.

As a professional, licensed debt collection agency, we see it as our social responsibility to help, guide, and advise our clients and the broader community on how to improve their financial situation—and how to better navigate their financial challenges.

In this section, we’ve compiled five helpful tips on how we, as a debt collection agency, believe you can quickly become debt-free—so that your finances will be less of a burden in 2022.

1. Prioritize your most expensive loans first

Almost all Danish families have debt—whether in the form of a car loan, a mortgage, or a consumer loan. But if you’re among the many Danes who also have a consumer loan in the form of a quick loan (also called an SMS loan)—and feel financially strained in your day-to-day life—this is the type of loan you should consider paying down first.

Payday loans are often expensive on a monthly basis—so if you have loans, you should make it a priority to pay off the most expensive ones first; these are often payday loans.

However, if you don't have a quick loan, you should consider which other loans you should pay off first and as quickly as possible.

2. Talk to your creditors

Are you having trouble meeting your debt obligations? Don't worry—you're not alone.

Our recommendation as a debt collection agency is that you contact your creditors—your bank, private companies, government agencies, your family, and any debt collection agencies—to whom you owe money. Even if you may not currently be able to make payments on your debt, and it’s therefore difficult to start a conversation, try anyway.

Many creditors will be understanding of your situation, and you may be able to arrange for a payment deferral, a freeze on interest, or a manageable repayment plan. Initiating a dialogue with creditors and debt collection agencies is always the way forward—regardless of how much money you have available to make payments.

3. Cut out unnecessary expenses

As a modern family, you have a lot of fixed and recurring expenses, ranging from Netflix subscriptions to cell phone plans, insurance, rent, and the like.

But have you recently thought about which ones you could cut back on—or maybe eliminate altogether? Most people could probably cancel a streaming service, find a cheaper cell phone plan, or maybe start looking for a cheaper place to live?

Remember, even a few hundred kroner a month can make a big difference in how quickly you can become debt-free.

4. Make a budget

Our debt counselors often find that many Danes with debt don’t have a budget—and that’s a shame.

Without a budget, you won't have a clear picture of your finances. And without that clear picture, it's hard to know which expenses you can cut back on—or perhaps do without entirely.

With a budget, you can figure out relatively quickly where you can save money—and what you’re actually spending your money on. If you don’t have a budget, you’ll undoubtedly be surprised at how much it can help you.

5. Seek help from professionals, friends, or family

For many people, their financial situation and their debt can seem overwhelming. It can be hard to see beyond one’s financial obligations. At the same time, they don’t know where to start.

Don't despair! Fortunately, there are plenty of people who can help you with your financial challenges—and you might want to start with your social circle, your friends, or your family.

If you don’t want to involve your loved ones in your financial affairs, contact a professional, an accountant, a bank, or a debt collection agency (if you owe them money).

You'll often find that even with just a few improvements and a better overview, you'll have more freedom in your daily life.

May 2022 be your year

At 2022, we help thousands of Danes become debt-free every single day—and we hope that 2022 will be the year you finally achieve your goal of becoming debt-free.

If you owe money to Collectia, which is one of our clients, we strongly recommend that you contact us.

We are a professional debt collection agency with over 150 years of experience, and we know how to treat people with debt in a professional and respectful manner.