Debt Free
STEP 1: CEASE ALL CREDIT PURCHASES!!!
The first step in getting out of debt is to stop going any further into debt. Refrain from using your credit cards and do not enter into any more credit agreements. If you don’t stop creating debt you will never be debt free.
STEP 2: MAKE A LIST OF WHAT YOU OWE CREDITORS
Gather all your latest statements and begin to make a list of all your debt obligations. Begin with the largest balance first. List the minimum monthly installments required, the applicable interest rate and the outstanding balances. You might get the shock of your life when you see how many credit agreements you really have and the total debt amount.
STEP 3: REDUCE YOUR EXPENSES
Look at your budget responsibly and see which expenses can be reduced. For example:
– Reduce your DSTV package to one that is less expensive.
– Consider reducing your cell phone contract to a more affordable package. There may be a penalty fee involved, but long term the reduced monthly fees will save you money.
If you are using a lot of minutes in excess of your plan allotment you may want to consider a different calling plan. The cost for the extra minutes can be very expensive. If you are consistently going over on your minutes you should upgrade to a plan that gives you the number of minutes that you need. The upgraded plan may have a higher monthly fee, but it will be less expensive than paying a lower plan rate with the overage costs for the extra minutes.
– Consider shopping for a less expensive homeowners / renter’s policy and car insurance.
STEP 4: PRIORITIZE YOUR REPAYMENTS
One method for reducing your debt is the manner in which you pay down your debt. For example, take the item or card with the lowest balance. This is the debt you will pay off first. You make a minimum payment on all the other credit cards and then you pay as much as you can afford on the card with the lowest debt. This will allow you to pay off the card with the lowest balance very quickly. Once that card is paid off, repeat the process with the next lowest debt. As you pay off the cards you will have more money to apply to the next card on the list. This will pay them down faster, reduce the amount of interest that you are paying and give you a sense of actually getting out of debt.
STEP 5: GET HELP
If any of your creditors are in the process of taking legal action against you or you are experiencing trouble in meeting all your monthly debt requirements, there is help.
For a free debt assessment contact 0861DEBTAID. An NCR registered debt counselor from Debt Aid Debt Counseling can help you consolidate all of your debt into one affordable monthly payment without incurring any more debt.
