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Help Me Get Out Of Debt!
or, Help Me Make A Budget
or, Help Me Be More Financially Responsible
You are now well on your way to getting out of debt. If you've been able to follow the process up to this
point you have demonstrated that you can analyze and track your spending. Now it's time to begin the
process of reducing your debt and putting you on the path to being debt-free. So what's the secret
of getting out of debt? Let's find out.
You primary goal is to maximize the 'leftover' amount. The amount you have left over after
paying all your bills. One good way to maximize this amount is to look at your expenditures and determine
the things you can do without. Ask yourself these questions:
See the Saving Money article for more ideas.
- Do you really need to go to the coffee shop and pay $5 or more for a cup of coffee you can make yourself for a few cents?
- Do you really need to eat out so much?
- Do you really need to go to the movies so often?
- Do you really need go shopping so much?
- Do you really need all those name-brand items or would generic work?
- Could you use coupons or look for specials when you do have to buy things?
The other way to maximize the 'leftover' amount is to bring in more money as income. Ask yourself these
Be creative. If you stop and think about it, there are many ways you could bring in more money.
The goal is to keep expenditures constant or lower, i.e. don't start thinking you can spend more
just because you earn more because you're still in debt.
- Do you have things you could sell? Online auction buyers pay top-dollar for used stuff these days.
- Next, are there ways you can earn more money?
- Would your current job give you a raise if you simply asked for it?
- Would your current job pay more if you took on more tasks?
- Can you work over time?
- Could you get a second part-time job?
- Could you get a higher paying job in your same field in a different company?
Now that you've maximized your 'leftover' amount, what to do next is extremely simple and is the secret
to getting out of debt:
- Find out the interest rates on all your loans and credit cards.
- After paying your normal monthly bills, take your entire 'leftover' amount
and send it to the highest interest rate loan or card.
- Make the minimum payment on all others.
- Do this until that loan or credit card is paid off.
- Once the loan or card is paid off, close the account and repeat this process.
Believe it or not, it's really just that simple. What happens when you do this is you are lowering
your debt every single month and when you pay off just one of your loans or credit cards that amount
is now free to pay down towards the rest, accelerating the process greatly. You just have to have enough
patience and self-discipline to start the process and stick with it.
Once you have achieved this, you have proven to yourself that you have what it takes to
start saving money. You now have the skills needed
to become wealthy.
Want to discuss getting out of debt?
Go to the Helpation Debt Forum!
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