No matter where you are in your walk of life your debt has gotten out of
control one way or another. If you’re one of the lucky ones and
have managed to get by without having large amounts of debt consider this
article a way to plan for the worst. If you follow these steps precisely
you can and will have 4 ways to get your debt under control.
Step 1. Stop spending and start saving.
The reason you got into this position in the first place is because you
were doing more spending than saving or spending beyond your means. Stop
using your credit cards to fund your entertainment expenses and no more
financing new furniture. Focus on the debt you currently have and figure
out a plan of action to pay it off before you have a major financial crisis.
Please proceed to Step 2.
Step 2. Figure out a plan of action
Organizing your debts is the key to figuring out a way to pay them off.
If you don’t know where your money is going and who to pay you’ll
be digging yourself deeper into the hole. List your bills by the debtor
and how much you owe. Once you have double and triple checked your list
organize the debt from smallest to largest and if possible include the
interest rate. Once your plan of action is complete proceed to Step 3.
Step 3. The Snowball Plan
The snowball plan is simple. Make minimum payments on all of your debts
except for the smallest bill (which is why we made a list earlier). Throw
any extra money that you have and pay off that debt completely. Once the
smallest debt is paid off use the minimum payment from that debt to pay
off the next smallest bill. That way you’re snowballing your payments
which allow you to pay off your debts more quickly. For more information
on the snowball debt consolidation plan please visit
The Debt Snowball Plan.
Step 4. Plan for the Future
By following the snowball plan you should be completely debt free in less
time than you would take trying to make several overpayments to all of
the debts at once. At this point, the best way to keep from having debt
issues is to have an emergency fund of $1000. Most people acquire debt
initially because they had an unfortunate emergency that caused them to
have to borrow money or finance their way out of the situation. Having
emergency money put away for such occasions allows you to the freedom
to use your own funds without eventual repercussions. SaveAndInvest.org
has a great step-by-step process that shows you exactly how to set aside
specifically for your family's emergency fund
Those are just 4 Ways to Get your Debt Under Control and snowball your
way to financial freedom. If you have any questions about obtaining your
financial freedom and want to seek the help of a certified financial professional
don’t hesitate to contact us