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simple ways of getting out of debt

Updated on January 20, 2011

Generally speaking, getting out of debt appears to be difficult. People find it hard to settle the loan they have borrowed. But getting out of debt becomes easier if you learn how to reduce spending, how to face your debt squarely and how to lower your payment. You must be determined and disciplined if you want to lessen and finally pay off your debts. It is also important that you design a plan to follow when you want to actually settle the loan you have picked. Some valuable steps that will help you get started include:

Ascertain your present debt level.

In order to pay off your debt it is necessary that you determine your current debt level. Although it is painful to see the total money owe, your knowing of the aggregate of what you owe will help inform you of your present debt level. You need to add up your debt. It is easier to use the debt calculator created by CNN money to work out how long it will take you to pay everything off.

            You can also prepare a chart that shows what interest you are paying on each of these loans.

            When you have decided to pay off your debt, tell your family members, especially your wife. Your sincerity to them will lessen some financial argument that may arise as you face your debt to settle it. If you are open to your spouse about your existing liabilities, especially at the start of the relationship, probably she will help support your decision to pay off the debt you have incurred.


Reduce your spending to pay your debt.

Getting out of debt requires that you adjust your spending. Instead of spending your money on unnecessary expenses, you can decide to leave off unnecessary desires and use the money to pay your debt .You can also use the money you spend on cigarettes, coffee or magazines to pay off your debts. It is often good to write down all that you spend for a week or a month to examine your expenses and any thing that is necessary may be rechanneled to loan payment .You can reduce your household expenses and lower your spending on items that are not too important so as to get some money to pay off your debt.

Change your spending habit

 Once you have decided to pay off your debt, it is wise to change your spending habits. Though it always seems difficult to change habits you have formed over the years. It is discipline and determination that you need to cultivate to help you adjust to your new condition.

            You must avoid creating anything that will make you spend more than you have planned. Since using credit cards can make you incur  higher debts than using cash, leave off credit card, instead use cash. Ensure you use cash that fits your budget every week and stop spending when you run out of money

            Use credit cards for bulk purchases and keep it at a place where you can have access to it when you want to make large purchases. This way you can save yourself from credit debt. Debts from credit cards come when we desire what we cannot afford

Consolidate your debt


Organize your loan and credit debts to determine your interest rates on each account. When you start to pay your loan, it is wise to pay off balances with the highest interest rates so as to save money in the long run. When making payment you must remember to include other cards such as department store cards and gas cards, which also have very high interest rates.

            Make sure you have not more than one favorite store credit cards. These cards usually come with high interest rates and have no benefits to your credit score. Reduce your credit card number to the minimum of 2 and the maximum of 6 .Of those cards you may have any of master cards, visa or America Express, since they are most frequently accepted cards. Examine cards that charge the highest interest rate and transfer balance from the highest interest rate cards to the lowest rate cards.

Determine to pay off your debt,

It is evident that the more debt you pay the quicker your outstanding loans will disappear. Try and pay more than the minimum and as much as you can pay every mouth. Ensure you pay any time to avoid allowing your credit card company to raise your rate. You can set automatic payment. Setting automatic payment can help you prevent late payment.

            You can use your savings to pay off your loan. It is possible that you have some savings in case of emergencies and it is better to use it to settle your debt.

Seek out help:

If you can’t go alone you may seek debt counselor to help you. Look for agents who are members of the National Foundation of Credit Counseling (NFCC) Or  the Association of Independent Consumer credit Agencies (AICCA) to assist you for advice. Debt counseling device is a good last resort if you can’t discipline yourself to make proper payment on a regular basis



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