Enjoy The Relief That Comes From Paying Off Your Debt
Having debt problems is nothing new for a lot of people, and you may be in that situation yourself. Do you feel like you’re in over your head? Like you just can’t keep up with the huge bills that barrage you every month? It can be very difficult to get out of that unfortunate situation.
Fortunately, there are things you can do to get out of debt with a minimum of fuss. The first step, ideally, would be to pay off your debt. For most of us, though, that is not an option. As an almost-as-good step, you should pay at least the minimums promptly each month. Above all, stop using your credit cards and begin living within your means.
If you are truly serious about getting out of debt, you need to face the monster. Get out all your bills and make a list or a spreadsheet showing everything you owe (total balance) and monthly payments. Most people want to hide from this information, but this is truly the first step in setting you free from the chains of debt.
Once you know what you owe, you can look at options for things like debt consolidation. There are a number of companies who will promise you the world, only to leave you cold, floundering in the wake of their unfulfilled promises. Watch for things like balance transfer fees, or interest rates that get jacked up the moment you are a day late on a payment. If you can find a good company, you will save money by paying less interest, and it will be more convenient to just write one check each month than trying to keep track of multiple credit card statements and bills.
Most financial experts recommend something called the “debt snowball” or something similar. You line up all your debts, as I said above, and you figure out how much you owe each month (minimum). By reviewing your monthly living expenses and making cuts where you can, you find some additional money each month to put towards debt retirement.
Begin with a credit card that has a small balance and apply that extra amount to your monthly payment. When that card is paid off, go for the highest interest card and apply the monthly extra, plus the amount you were paying monthly to the first card, and pay that each month. Every time you pay one off, apply its payment, along with the extra, to the next card and so on. This takes time, but it is a truly effective method for getting out of debt.
Be very wary of “credit counseling” services who promise to negotiate your debt down. This often shows up on your credit report similar to a bankruptcy, which is what you’re trying to avoid in the first place. I’ve found the Credit Secrets Bible to be a very helpful resource that you might want to look into.
Learn more about how to get out of debt
