6. Figure out your debt pay down fund amount. Looking at your new budget, you’re going to be able to see areas where you might be able to cut back. You might also see categories where you need to increase spending.
- In doing this step, no one is suggesting that you come up with budget amounts that are unliveable. Think about going on a diet. If you try to restrict your calories excessively, what’s the first thing you want to do? Krispy Kreme here you come, right? The key here is to be realistic.
- Are you paying money for a gym membership you never use, despite your best intentions? What about the $4 a day, every day, morning coffee you get before work, or your 5-cans-of-Diet-Coke-a-day habit? Chances are, your budget has some fat that can be trimmed. At the end of this exercise, you should have come up with a figure, a number of dollars that can be put toward debt pay down.
- Make a note of this figure. Day-to-day, if you don’t want to keep taking note of all your expenditures, just write down what you spend in the categories you are trying to cut back. This will give you a very clear idea of how well you are doing, and, if you know you’re going to go over your budgeted amount, it may help you decide to hold back on a purchase.
7. Figure out how much you owe, to whom, and on what terms. Debt can often feel overwhelming because you really don’t have a clear idea of how much in debt you really are. Gather your bills, and make a simple list or spreadsheet of all the debts you have. Write down all the pertinent facts, including name of the creditor, your total balance, your minimum monthly payment, and your interest rate.
8. Start paying it off. Take the debt paydown figure of money you trimmed from your budget in step 4, and apply it to debt repayment. It’s a good idea to prioritize the debts to which you are going to apply this extra money.
9. Wash, rinse, repeat. Just kidding, but you get the idea. This process gets easier. Once you’ve figured out your spending and what debts you owe, keeping it up gets easier and easier. You’ll refine your budget over time, increase the amount of money you can pay yourself (see tip below) and the amount you can put toward debt. Continue to pay off each debt in your priority list. As you pay off convenience cards and high interest credit cards, call those credit card companies and cancel those accounts.
10. Don’t give up. Chances are you didn’t get into debt in a day, and you won’t get out of debt in a day. Quick fixes don’t last, but learning how to manage your money can bring great peace into your life, and you can spend your mental energies on more fun things.
These tips if appropriately followed will assist you in tracking your debt and also give you insight on how to clear them out finally. If you will like to make extra MONEY on the Internet, why not follow our system and let us introduce you to the world of being DEBT FREE CLICK HERE TO START
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