Debt can turn a dream life into a nightmare. Before we know it, we can get overwhelmed, partly because there are those organizations out there who prey on people in financial need. However, all is not lost, as long as you are willing to follow some important ways to get out of debt. Here is some quick advice to help you stop the bleeding, reduce your debt, and eventually live the life you dream about.
(1) Create a budget. You won’t know your financial health unless you have a written down summary of your income and expenses. You can get as detailed as you want with your budget – the more details, the better – but at the very least your budget should help you figure out places to increase your income and decrease your expenses.
(2) Try to renegotiate your debt. If you are having trouble making your payments, and possibly thinking about bankruptcy, you will have some leverage here to renegotiate the rates, payment schedule, and so on.
(3) Borrow money from friends and family. You’ll want to draw up official documents to make sure everyone understands the process, but this is a great way to get an extremely low interest loan from a friend to help take some of the pressure off. Even if you just use it to wipe out your high interest rate debt – such as credit card debt – it will be worth it.
(4) Pay off your high interest rate debts first. This will save you the most money over the long run, because these will cost the most over the life of the loan.
(5) Finally, get a free credit report to analyze your current debt situation. You want to stop the bleeding as much as you can, especially when it comes to your credit score, the lifeblood of your financial health.
- What Debt Consolidation Services Can Do (debt-consolidation-2u.com)
- Nations Debts like Never Before (debt-consolidation-2u.com)
- Is transforming debt into wealth easy? (2011tax.org)