When Is It Time to Restructure Your Debt? | goWave by RHB
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When Is It Time to Restructure Your Debt?

People take on debt for various reasons while debt is being paid back in different ways. Have you ever thought of paying back debt and loans more efficiently? If not, let us share some tips and tricks on how to optimize this process.


If you’ve never heard of debt restructuring before, we can define it simply as ‘the process of reorganising your existing debts assisting you in repaying your obligations in a more cost or time efficient way’. People restructure debt for different reasons from which one of the key ones is better interest rates and better payment plans.


When is it time for you to consider restructuring your debts? Let us look at some points together.

Sign 1:

Too Many Bills, Too Little Time To Track

Are you drowning in bills? If you find yourself struggling to pay your monthly bills timely and correctly, you should consider this an important sign for you to start thinking about debt restructuring. Although no one loves to pay bills, not paying them on time will often result in late payment penalties. You really want to avoid this! Late penalties appear as fixed charges or a percentage of the outstanding amount and increase over time each time you miss payments. Keep in mind that these number accumulate and increase as interest rates and penalties will start to apply to larger outstanding amounts.

Sign 2:

Credit Report Status: Unhealthy

Another sign indicating the need for debt restructuring is a decreasing credit report status. In the near future, as credit scoring in Cambodia becomes more widely used, credit score reports will only become more important for consumers as these reports will be used by different financial institutions to evaluate your personal financial health. In general, a good credit score should give you better chances of obtaining financial services such as loans, approved. With that in mind, in order to improve or maintain a good credit score, you will have to start paying all your bills in full and on time.

Sign 3:

Only Paying The Bare Minimum

Paying only the minimum amount of your bills will cause you to consequently drag your debt on for a longer period, causing you to pay higher interest amounts across the year. This could put you in a financially dangerous situation as you’ll be forced to fork out more money over a specific period of time. Don’t move your financial challenges forward. Take care of them as they occur. You don’t want to be stealing luck from the future!

Time to Reprioritise

In case you have difficulties paying outstanding bills on time, there are a few options you have as a consumer.


Firstly, completely rethink your personal expenses. If you can’t pay bills on time it probably means your personal expenses are exceeding your income. It is not rocket science to know that, in a situation like this, you must either increase your income or decrease your personal costs.


Ask yourself these questions:

  • What are items you can temporarily do without?
  • Do you have any subscriptions running you can temporarily pause, or can you downgrade services?
  • Are there any purchases you regularly make, you can hold off on?
  • Do you really need coffees and snacks or a new phone every 18 months?


These questions will help you assess your priorities; fixing the root cause of the problem goes a long way.


A second way to restructure your debt is by applying for a debt consolidation loan allowing you to consolidate all your debts into a single loan, making it easier for you to go through the repayment process. It usually also offers you better payment terms, such as lower interest rates and lower monthly repayments.


It’s crucial to understand that a debt consolidation loan does not erase your current obligations. It essentially only assists you by paying all your debts through a single account. It is also advisable to do your due diligence and read through the loan’s terms and conditions to fully understand its interest rates, penalty charges and additional fees. Although debt consolidation loans are one of the most popular alternatives due to their convenience and flexibility, there are various other debt restructuring tools in the market as well. Look out for them to better understand what your alternative options are.

Quick tip:

Creating a personal debt tracking sheet will provide you with a clearer insight into your debt repayment progress. The overview will allow you to constantly track, monitor and make changes to your spending habits which might allow you to pay off your debts sooner. Take on the challenge when you face it!

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