Ways to Decrease your Debt - How Important Is Your Finance

Uncontrollable debt can add up quickly. Credit card debt and loans can become unmanageable, so you need to try to find some relief from your debt. Here are a few helpful tips to reduce your debt.

1. Create a Budget
If you know exactly what you are spending your money on, you might be surprised at what you really do not need. Make of list of everything that you spend. Keep track of your grocery bills, entertainment spending, monthly bills and anything else that reduces your bank account. After you examine your spending, you can find areas to cut spending. You will then have extra money to reduce your debt level.

2. Examine your Credit Card Bills
You need to make a list of your credit card bills, so you will know exactly how much you owe your creditors. You also need to write down the interest rate you are paying and the due date of each bill.

3. Pay the Smallest Amount First
By paying the lowest balance first, you can slowly start to chip away at your debt level. After you have paid the smallest balance, then you can pay the next smallest balance. Each time you pay off a credit card, you will have more money left over to pay off another card.

4. Get Credit Counseling
Credit counselors can help you negotiate with your creditors to obtain a lower interest rate and fewer fees. They will also help you come up with a repayment plan that you can afford. Social media is a good source to help you find a good credit-counseling agency.

5. Stop using your Credit Cards
You cannot reduce your level of debt if you keep using your credit cards. If you cannot pay for your expenses out of your checking account, then you do not need to make the purchase.

6. Get a Second Job
You can temporarily find another job to give you another source of income. You can use the extra money you make to pay off your credit card balances until your debt is significantly reduced.

7. Get a Debt Consolidation Loan
A debt consolidation loan will allow you to combine all of your debts into one single debt. You will only have one payment to make, so your bills will be easier to manage. With a consolidation loan, the interest rate you pay will be lower than your credit card interest rates.

8. Pay your Bills on Time
If you make late payments, additional fees will add up. Even if you only make the minimum payment, it is important to pay your bills when they are due. If you continue to be delinquent on your bills, your credit score will decline, and you can become stuck in a cycle of debt.

9. Transfer Credit Card Balances
You can find a credit card that offers a 0 percent APR for the first few months or the first year. You can then transfer your higher interest rate balances to your new credit card. This will allow you to pay off your balances quicker.

10. Continue to Save
If is still important to have an emergency fund, so you can pay for unexpected expenses that might arise. You never know when you are going to need money for car repairs, medical bills or home improvements. If you have extra money set aside, you will not need to put these expenses on your credit card.

This post was written by Louis Parker, a personal finance specialist. He recommends SOS Dettes to people facing hard financial times and that need debt settlement Montreal services.

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Source: http://www.howimportantisyourfinance.com/2012/10/23/ways-to-decrease-your-debt/

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