While it may have taken you just one wild shopping spree to get into debt, you won’t get rid of your debt overnight. But if you can create a plan to manage your debt and stick to it, you will one day live a debt-free life.
Here are 6 things you need to do in order to begin to pay off your debt.
Paying off your debt takes time. Be patient, as progress is slow. Treat your debt like a video game. Every positive step you take should get your debt to decrease and your credit score to increase.
Always keep your goals in mind. Attack your debt with power. The goal is to destroy it. Just keep your eyes on the prize and eliminate those debts one by one, little by little. Do not give up.
Don’t pass the buck. It is not the fault of anyone else. You might have been young, in a tough financial situation or were tricked or convinced into making bad deals. Yet you were still the one who made these irresponsible choices.
If you do not take full responsibility for these debts then it makes it more difficult to pay them off. You won’t have the motivation to pay off a debt if you blame someone else for it.
Separate Needs vs Wants
Determine what is or isn’t a necessity. This is the only way to control your spending. If you don’t control it you will just get back in debt all over again.
If you want to get out of debt, eliminate some expenses that are considered luxuries. This includes those $4 lattes, the $40 restaurant trips and yes even your $90 cable bill. It’s going to hurt, but the goal here is to eradicate your debt.
Create A Budget
Create a monthly budget by listing your earnings and your expenses. Sounds simple enough. But in your budget, make sure to make room in this budget for the repayment of your old loans and outstanding debts.
A regular budget has all the usual items like food, rent and utilities. But a really good budget also includes money going to your savings account, money going to pay back your debt and money going to ‘miscellaneous’.
Don’t Be Discouraged
It is possible to live a debt free life. No matter how much debt you have, there’s a way out. Think of your debt is a big giant rock. Right now you’ve got a small pick and you’re striking this huge boulder.
At first, you’re barely scratching the surface. But later, as you make more progress, you will begin to chip off larger and larger portions of the rock. Before you know it, this rock, which represents your debt, is now a pebble you will pulverize with one more strike.