Eliminate Your Debt - Live Longer? At Least Better
Debt is a burden, we all know that. Too much causes worries and that can lead to any number of bad things. In the worst scenario worries over debt can make you ill, perhaps very ill. If you're faced with this problem the best time to start doing something about it is right now.
Debt is money owed we can't pay back right away or payments that are running us even deeper into the ground. We've in a sense turned into a society that has gotten used to living on credit, which has put us in a mess. The first step has to do with attitude. Pay cash as you go. Not easy and maybe impossible to do in one big step but you've got to start trying. A very workable approach is just to start getting creative as to what you can do to save a bit here or a bit there.
Starting out with the right attitude isn't going to make your debt go away right away. First things first and that is to start spending smartly and spending less. Your first goal should be to avoid going any deeper into debt. Once things are starting to level out you can focus on reducing the debt you have.
To actually keep expenses down and start reducing your debt you want to start living on a budget. Budget is a dreaded word for most of us. We equate it with a Spartan existence, bland diet, no more toys and the like. Your budget however represents your plan of action. Laying out your budget is not the easiest thing to do, be prepared to struggle at first and it may take a month or two before you actually find a plan that works, a budget that fits. Make a list of what you're paying out for bills, food, clothing and entertainment. Then start prioritizing and assigning dollars to each category.
Once you have spending under control start paying off outstanding loans. Think of a loan as something you bought or did a long time ago and are still paying for. Was it worth it, and do you want to keep on that path? When you think about it you'll probably come to the conclusion that paying up front is much more satisfying. you don't get the bad aftertaste.
You can either tackle the loan having the highest interest first or start with the smallest loan and work up to the largest. Either way works and when followed will result in a snowball effect. As you pay of each loan it becomes that much easier to pay of the next. Paying off that first loan is a victory, a small one perhaps but a victory nevertheless. It's almost guaranteed that you'll be feeling better about yourself when that happens and determined to tackle the next loan.
You've finally paid of your debt. Now what? The rule here would be don't go out and buy yourself a congratulatory present, on credit? It's OK to celebrate, you deserve it, just don't go overboard. The next goals are to stay out of debt , save, and invest in your future. Watching your saving and investments grow is much more fun than watching your debt increase.
The savings you "pay" yourself will be useful in the future when you are ready to make large purchases. Instead of financing a new car at 8%, you can stay out of debt and maybe get a discount by paying cash, or you could make a large down payment on a home or send a child to college. The sky is the limit!
Debt is money owed we can't pay back right away or payments that are running us even deeper into the ground. We've in a sense turned into a society that has gotten used to living on credit, which has put us in a mess. The first step has to do with attitude. Pay cash as you go. Not easy and maybe impossible to do in one big step but you've got to start trying. A very workable approach is just to start getting creative as to what you can do to save a bit here or a bit there.
Starting out with the right attitude isn't going to make your debt go away right away. First things first and that is to start spending smartly and spending less. Your first goal should be to avoid going any deeper into debt. Once things are starting to level out you can focus on reducing the debt you have.
To actually keep expenses down and start reducing your debt you want to start living on a budget. Budget is a dreaded word for most of us. We equate it with a Spartan existence, bland diet, no more toys and the like. Your budget however represents your plan of action. Laying out your budget is not the easiest thing to do, be prepared to struggle at first and it may take a month or two before you actually find a plan that works, a budget that fits. Make a list of what you're paying out for bills, food, clothing and entertainment. Then start prioritizing and assigning dollars to each category.
Once you have spending under control start paying off outstanding loans. Think of a loan as something you bought or did a long time ago and are still paying for. Was it worth it, and do you want to keep on that path? When you think about it you'll probably come to the conclusion that paying up front is much more satisfying. you don't get the bad aftertaste.
You can either tackle the loan having the highest interest first or start with the smallest loan and work up to the largest. Either way works and when followed will result in a snowball effect. As you pay of each loan it becomes that much easier to pay of the next. Paying off that first loan is a victory, a small one perhaps but a victory nevertheless. It's almost guaranteed that you'll be feeling better about yourself when that happens and determined to tackle the next loan.
You've finally paid of your debt. Now what? The rule here would be don't go out and buy yourself a congratulatory present, on credit? It's OK to celebrate, you deserve it, just don't go overboard. The next goals are to stay out of debt , save, and invest in your future. Watching your saving and investments grow is much more fun than watching your debt increase.
The savings you "pay" yourself will be useful in the future when you are ready to make large purchases. Instead of financing a new car at 8%, you can stay out of debt and maybe get a discount by paying cash, or you could make a large down payment on a home or send a child to college. The sky is the limit!
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posted by Credit Counseling at
5:56 AM
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