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Tired of credit collectors blowing up your phone?  Tired of receiving collection letters in the mail?  Well, you and a million other people are sick of it. But, the first thing that you have to come to terms with is the reason why you owe so much anyway.  Many Americans, especially, engage in overspending and living above their means. We love to “keep up with the Joneses”, show-off the material things to our friends and family, and buy stuff that simply has no value.  Overspending is a condition that we all suffer or once suffered from. How do we get help with this problem? Initially, it will take you to make the decision to want to change. Once you have conquered that, you are on your way to living a healthier financial life.

 

Okay. To get started on your debt-relief process, here are several ways to slash the amount of money you owe.  Although these bullet points are not full proof, they will at least put you in the right direction.

 

  • Obtain a copy of your credit report.  Americans are given two free copies each year. Then, compile a list of unpaid credit cards and outstanding loans. Add up the balances. The total you end up with is the overall amount you are in debt with.

 

  • Decide which outstanding balances you want to start paying off first.  Some people choose the smaller accounts first. Outstanding balances that are low (a couple hundred dollars) is preferred because it will take the shortest time to pay off.

 

  • Contact each credit lender/agency and speak with a representative about a possible payment plan. Before you start paying against the debt, make sure you have a steady income coming in. If you work, see how much you can put in a savings each pay check. After you’ve calculated your monthly household expenses, use the money you have left over to put in the savings. You can use a portion of that savings to pay off the debt or you can set up a separate account to store your “debt-money”.

 

  • Pay more than the minimum monthly fee on your credit cards and loans.  It is better to pay more than just the minimum. This will allow you to see your balance decrease much faster than anticipated.

 

  • Transfer debt to a credit company with a lower interest rate. It is smart to consolidate or transfer debt from the card with the 20% or more rate to an account with a lower rate.  This is a definite way to adjust your monthly minimum fees, thus giving you an opportunity to pay more against the balance.

 

  • Watch what you buy if you can’t handle the monthly payments! Stay in your lane and learn to minimize your purchases. This will save you much financial grief later on.

 

 

Hopefully, these few tips can put your on your path to debt freedom.  If you check online, there are many outlets that provide programs to help you sort out your debt (i.e. www.payoff.com).  Information is always available. There is no excuse to continue to be in debt.

 

Good luck on your journey!

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