Advice for Reducing Debt

Are you drowning in a sea of consumer debt? Whether you’ve racked up credit card bills for purchases or are trying to dig out from a mountain of medical bills, help is on the way. So many people are one paycheck away from losing their homes or maxing out their credit card spending limits. Regardless of the circumstances that led to your debt issues, follow these recommendations from the financial experts for concrete solutions to begin climbing out of debt.

To change your circumstances, you need to not only have a goal, but also a plan and a strategy for executing that plan.  Be detailed and methodical and you’ll lose the stress and regain the pleasure of sleeping through the night. Use a spreadsheet or a legal pad and list all balances owed on credit cards, charge cards and medical bills as well as minimum payments.  Arrange these from the smallest outstanding a balance to the largest. Take advantage of the awesome savings offered by Groupon coupons and pick up basic office supplies from the selection and value available at Walmart.

There are two ways to reduce debt. The first, and sometimes the least complicated, is to secure a part time position. Earmark all of the earnings towards debt reduction.  Depending on your current circumstances and the logistics of a part time position, this may or may not be possible.

The second option for reducing debt is to reduce discretionary spending and earmark the savings towards reducing your debts.  On a daily or weekly basis, at first glance, it might not appear as though discretionary spending is very high. Consider the amount spent each day on designer coffee and lunches with coworkers. This can add up to several thousand dollars a year.  Remind yourself that short term frugality will result in the reduction of your debt in the long term.  Turn every dollar over during this period of debt repayment. Cancel subscriptions, no matter how small the cost and earmark those savings towards your goal.  Finally put something that represents your freedom from debt on the refrigerator or bathroom mirror to remind yourself each day of the goal you’re working towards.

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