Saturday, December 4, 2010

Best Ways to Get Out of Debt

The best ways to get out of debt depend on the reasons you're in debt, how much debt you have, and what kind of debt it is! So, though I've listed a few ways to get out of debt here, they may not apply to all people in all circumstances.

But, these tips could help you -- especially if you apply them to your life for at least a month.

Best Ways to Get Out of Debt

Understand your spending habits. The first step to get out of debt is to understand your saving and spending habits. To get your spending in control, use a small notebook or PDA to jot down every penny you spend for at least two weeks. This will help you identify the source of your financial problems.

Visualize financial abundance. Another way to get out of debt is to take a few minutes every day to imagine the new, debt-free you! Dream about how your discipline and new spending habits will pay off in the end. Sit back, close your eyes, and imagine a time when no requests for late payment arrive in the mail and there are no mounds of loans to pay back. Look forward to the results of planned savings, such as vacations, new furniture or even retirement.

Prioritize your bill payments. One of the biggest money mistakes people make is paying extra money because of the interest on their debt. Unless you pay off your debt the right way, you’ll never make any real progress. Pay off the debt on the bills that have the highest interest rates, then move on to the bills with lower interest rates.

Remember: small changes can have HUGE effects! There are a lot of small money saving techniques and strategies that can help you get out of debt. For instance, you can cut back on one coffee a day (approximately saving $4 per day). This is an easy way to start solving your money problems.

For more money help:

What do you think of these ways to get out of debt? Comments welcome below...

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