Money problems are causing misery for ever more of us, and levels of personal debt are at their highest ever. Most of us want to start paying down our debts, but the job can appear overwhelming. There are, nonetheless several effective techniques you can use to get started on the course to a debt free future,
First Of All, it's vital to look at your spending and cut it back whenever viable. There's little point in working to pay down debts with one hand while the other is at work building up new borrowing. Decide to stop using your credit cards except as just a way of shopping, always paying back what you've spent when your statement arrives. Also look at economizing on your daily outgoings - buying cheaper goods, relinquishing the occasional treat or night out, it all counts.
But doing solely this will not do much to reduce your debt - you need a programme to pay it off as soon as you can, and this is where the technique of 'snowballing' applies. Fundamentally, you put all your effort into paying down one debt as quickly as you can, putting all your spare cash into this effort while holding your other debts at their minimum repayment amounts. Once this first debt has been cleared, add the monthly repayments you'd been making on it to the payments on the next debt in the line. This way, the effectiveness of your money gets greater and greater as it channels from one debt to the next.
If you're having serious difficulty meeting your repayments, though, the previous two techniques aren't going to fend off disaster. It's here that debt consolidation might be a utilizable option. The basic idea is to make use of a new source of credit, and use it to pay off all your existing debts. The idea is that servicing your new single loan will be more affordable than the total fees, interest and charges of your former debts, and so more of your money will go towards clearing what you owe rather than just treading water paying the interest.
You really need to be careful with this last option though, as you're potentially adding to your debt problems rather than easing them. Be sure you have the self-discipline to clear your old debts and not run them up again before going down this route.
None of these options are simple, and none are without their downsides. However, most of us accept now that debt levels are too high and we need to start doing something to reduce them, whatever the short term discomfort that might be involved. By taking these suggestions and putting them into action, you can make that initial step towards becoming debt free.
Author Resource:
Nicholas writes on various aspects of personal debt, from managing credit card debts to stopping repossession .
![[Valid RSS feed]](http://www.look4articles.com/images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites
![[Valid RSS feed]](http://www.look4articles.com/images/rss.jpg "XML Feed For RSS")