Budget101 Discussion List Archives Frugal Savings 10 Steps to Conquer Debt

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    • #235005
      Avatar for LissLiss
      Keymaster

      TEN SIMPLE STEPS TO CONQUER PROBLEM DEBT

      If you’ve identified a problem in the area of personal
      debt, you’ll need to
      set about remedying the situation. Here are easy steps
      to regaining
      financial control:

      1) Seek help. If you’re not sure how to proceed, or
      you’re feeling too
      overwhelmed to act for yourself, call a non-profit
      credit counseling program
      for advice and assistance in working with your
      creditors to set up a
      repayment plan. Consumer Credit Counseling Service has
      offices throughout
      the US. Call 1-800-388-CCCS, 24 hours a day, for an
      office near you. You can
      also find information about debt problems from your
      local church, library or
      bank. Look for information on-line as well.

      2) Contact your creditors. As soon as you’re aware you
      won’t be able to make
      a payment, contact your creditors. Creditors are more
      likely to work with
      you if they’re contacted before the payment is
      actually overdue. Debt
      collectors are trained to solve payment problems, so
      don’t be afraid to be
      honest with them about your financial situation. Stay
      calm. If you commit to
      paying the bill by a certain date, be sure you follow
      through on that
      commitment. The creditor won’t be likely to work with
      you again if you don’t
      keep your payment promises. If you can’t make your
      minimum monthly payments,
      write to each creditor individually and see if you can
      work out smaller
      regular monthly bills. Be sure to explain to them why
      you fell behind in
      your bills, your current income, your other financial
      obligations and the
      exact amount you can pay them each month.

      3) Cut up all credit cards and send them back to the
      issuing companies
      immediately. Officially close all credit accounts. The
      temptation when you
      start seeing lower balances on your accounts could
      lead you to charge the
      credit limits right back up again if the accounts
      remain open. Don’t take
      out anymore loans or open any new credit accounts
      until back bills are paid
      in full.

      4) Set a frugal budget and live within it. It’s
      usually easier to decrease
      spending than increase income. Don’t make any
      purchases above and beyond the
      absolute basics until you’ve made some headway in
      catching up on your back
      bills. Consider selling assets to find more money for
      your debt repayment.
      Even just holding a large garage sale can sometimes
      generate enough money to
      help pay an immediate bill or two.

      5) Prioritize debts. Mortgages, child support and any
      debt that has gone to
      a collection agency is a priority. After you’ve
      identified the first
      priority debts, look for the credit companies that are
      charging you the most
      interest.

      6) Pay each creditor something. No matter how small
      the amount you’re able
      to pay, it will show good faith on your part as you
      try to negotiate payment
      arrangements.

      7) Track personal spending. It’s important to identify
      any holes where your
      money is draining out. Keep a detailed record for one
      month of every
      expenditure, no matter how insignificant. Little
      expenses on a regular basis
      add up quickly. Carry a small notebook with you and
      write down every single
      purchase. Now you’ll know where your money’s going.

      8) Plug up any holes discovered from the spending
      record.

      9) Plan ahead for annual expenses (i.e.: insurance,
      car licenses, medical
      deductibles, etc.).

      10) Set long term financial goals. After setting
      concrete, definite goals
      for future financial health, make all current
      financial decisions with your
      future well-being in mind. Keep the end result in mind
      — debt-free living!

      Cindy Sue

    • #429555

      You can also follow Liss’ ebook & use the money you save on your grocery bill to pay your old debts down. It’s on the article page. showered with love

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Budget101 Discussion List Archives Frugal Savings 10 Steps to Conquer Debt