Debt Elimination One Step At A Time

Financial mismanagement and overwhelming debt can cause personal grief and strain family relationships. Here's how to tackle the problem one step at a time. Stop Creating More Debt Whether you make a thousand dollars a day or a thousand dollars a month, problems occur when you spend more money than you earn. Cut up your credit cards. Start paying for everything in cash. Avoid expensive purchases. Do what you have to do, just stop spending money. Watch out for the little things; a cup of coffee here, a donut there... those items can add up quickly. Work at changing your spending habits, and you'll achieve debt freedom that much faster.

Free Up Some Of Your Earnings
Once you've stop taking on more debt, it's time to look at freeing up some cash to pay down the existing debt. Most people have trouble with this because they have little cash to spare and don't know where to start. Every situation is different and everyone has their own personality. Here are some suggestions to open up your mind to other possibilities.
First you could be even more aggressive with your budget so that you in fact spend less than you earn. You might want to eat in more often, and look at buying no-name brands. Look through your garage and find all those items that have been gathering dust for the past couple of years. Take them out and have a garage sale. Consider looking for a part-time temporary job. Working a few extra hours on the side can bring in some needed extra cash. On the bright side, if you're busy working you won't be busy spending. Just remember that it's only temporary.
Pay Down Debt With The Highest Interest
The interest that most people pay on their credit cards is absolutely incredible. Make sure you're meeting the monthly minimum payments on all your debt. Then take the extra cash and apply it to the debt with the highest interest. Continue to focus each month on paying down only that one debt until it is completely eliminated. When that debt is finally eliminated, make sure you don't start using that credit again! Remember, you've got other debts to pay down.
Continue Paying Down Debt With Your Excess Cash
Once you've paid down and completely eliminated one debt. Congratulate yourself. You've got extra money, but don't spend it. Use it instead to pay down your next debt with the high interest rate. Keep this process going until eventually all your debts are paid down.
Is Debt Elimination Really Possible?
Yes it is. Most likely you didn't get into debt overnight. It will probably take some time to eliminate all your debt, but it can be done. Keep your eye on the end goal. You can do this!
By: Alan Pavan