In today’s world, where we feel a compulsion to keep up with our neighbours, it is very easy to get into debt without even realizing it. Trying to work your way out of it can be a very difficult experience. Credit card interest rates, decreased income, illnesses and many other factors can lead to an unmanageable debt load.  It may seem insurmountable, however, getting out of debt is generally not an impossible task. With a little bit of planning, discipline, and patience, you can find success.

The first step in getting out of debt is to get organized; figure out what needs to be paid and when. Make a list of all the debts that require payment with the most important ones, such as your mortgage or income tax payment, at the top. The next step is perhaps the most difficult.  Create a monthly spending plan or budget that you can afford. This will result in your debt not becoming any larger due to unnecessary spending. It will also allow you to see where you money is going, which should help you determine where decreases to your spending are required.

Once you have organized your debt payments, you may have the option of consolidating your debt. Transferring all of your debt into one consolidation loan with a lower interest rate than the rates typical credit cards and other lines of credit provide will not only lower your debt obligations in the long run, it will also give you some peace of mind by transforming all or most of your debt into one simple monthly payment. If you are able to obtain a consolidation loan it is absolutely imperative that you destroy your credit cards. It would be dreadful to end up with the same amount of credit card debt and also have the consolidation loan in a year’s time.

While in the process of paying off your debts, hide your credit cards so that you lose temptation of using them again. Once you pay off certain credit card balances, cut up the cards and close the account. You generally need only one credit card for your day-to-day needs, and choosing one that has a lower interest rate will save you a lot of money down the road.

Finally, if you are so overwhelmed with your debt that you feel you will never get out of it, get help. It’s better to ask for help sooner rather than later because the sooner you ask, the more options may still be available to you. 

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