If you are struggling with or have ever struggled with debt, then you know that it is not easy to get out of debt. It takes time and a good deal of effort at that.
But many Americans have way too much debt. Having a little debt can be fine as long as you are prompt about payments but it is all too easy to let it spiral out of control in an instant. One missed payment can quickly become two missed payments and then three and then you might just find yourself in way over your head.
At the same time that many Americans are loaded down with overwhelming debt, not very many of them know how to get out of debt. One of the most common ways that people try to deal with the problem on their own is by making only minimum payments. This is a recipe bound for disaster.
Though it can make sense to make minimum payments when you are struggling financially, it will only lead to your debts sticking around for years on end. This will lead to thousands of dollars extra paid in interest – money that you don’t need to spend if you go about getting out of debt in the right manner in the first place.
Luckily, getting out of debt is actually fairly easy. All that it takes is a little knowledge and know-how. Below is our Project Debt Relief ‘Get Out of Debt 101.’ View it as a guide or a class of sorts. Read the below information and really try to soak it up as you would academic information. When you make good debt relief and money management techniques a part of your life, you might just find yourself getting out of and staying out of debt.
Don’t Fall Into Debt in the First Place
The best piece of ‘get and stay out of debt’ advice is to, quite obviously, not fall into debt in the first place. Also obvious is that this is more easily said than done.
One of the best ways to prevent yourself from falling into debt in the first place is by watching out for the warning signs. If any of these signs apply to you, then you might be in danger of falling into debt:
- You have no emergency funds, no money stored away for safekeeping
- Your monthly expenses are getting the best of you, you are having trouble keeping up with everyday things
- Collection agencies are starting to contact you
- You are only able to make the minimums on monthly payments
How to Get Out of Debt
If you ignored or didn’t notice the warning signs (or still fell into debt anyway), then there are still several things that you can do to get out of debt – and do it fast!
The best thing for you, or anyone, to do when struggling with debt is to create a budget plan and stick to it. A budget plan will help you set aside money for monthly payments and monthly expenses while serving as a map to where your money goes. It will help you see where you are spending your hard-earned bucks and if there is anything that you can do to save more of them.
The next best piece of ‘Debt 101’ advice is to set a debt elimination plan. Such a plan is a great way to get out of debt. Many debt elimination plans require the following elements:
- A pledged commitment from you that you’ll never incur debt again.
- An overall change of attitude that will prevent you from repeating the behaviors that got you into debt in the first place. This is a very important piece of the process. Decide to never buy things again that you can’t pay for right away.
- A pledge not to acquire any new debt and the willpower not to open up any new credit cards.
- A budget plan, like the one discussed above, that will help you live frugally, meet your monthly expenses, and set aside money for future large purchases. Using an online savings account is a very nifty way to easily track your earnings, your spendings, and your overall debt elimination progress.
If you’re still having trouble with debt, and you just might be, then it is time to consider the several options that you have left. These include the following:
- Transferring your balances to a low interest credit card to limit the amount of interest that you will end up spending overall. This can only be done if you have decent credit. Also be sure to watch out for hidden fees associated with the new cards.
- Bundling all of your debts into a single long term loan. Many people can combine their credit card debts into a home equity loan that has home interest.
Finally, if you still haven’t gotten out of debt, then getting professional debt help assistance might be your only way out of debt. There are a ton of different debt relief services that are offered, many of which are discussed in greater detail on the Project Debt Relief website. A few of the most popular include
At the end of the day, everyone’s method of getting out of debt will be slightly different. No two people can or should employ exactly the same method as their neighbor. The key to getting out of debt is working hard, taking the time needed, and staying vigilant. And, of course, making sure that after you get out of debt you never fall into debt again…that part is big, if you can imagine that!