If you feel like you are swimming in a sea of credit card
debt, you are
not alone. This fact probably will not make you feelany
better, but the fact that you have lots of company means that there are a
variety of debt reduction strategies and debt consolidation services you can
use to get back on solid financial ground.There is a thriving industry full of
companies that do nothing but help consumers get a handle on their debt
problems. These credit counseling firms run the gamut from non-profit community
based organizations to national chains to huge mega companies with a branch in
every major city. Finding the right company to entrust with your debt reduction
can be difficult and challenging.
Before turning to an outside company for help, however,
there are steps consumers can take on their own to reduce their debtload. Of
course the easiest strategy is to put extra money toward retiring your debt.
Every extra dollar
you put toward your credit card balance is one more dollar
on which you will not owe interest or penalties.
Of course, finding that extra money can be a challenge. Most
people are lucky to have a few dollars left over between paydays,and many
consumers find themselves out of money before they are out of month. This is
where a good
budget program can come inhandy. Budgeting is not a skill
that is taught in school, and it is often not taught at home either. Learning
how to make a budget and stick to it can be the most important aspect of your
financial life.
Try this little exercise and see if you can’t shake loose
some extra money each month. Write down every expense you incur for at least a
week. That’s every expense – every cup of coffee, every meal, every trip to the
grocery store,
every trip to the mall, every tank of gas. Be scrupulous
about recording every penny you spend and what you spend it on. At the end of
the week, add it all up and give it close scrutiny. Ask yourself if every item
was a necessity. Are there places you can cut backon your daily living
expenses? Even a dollar or two a day can add up quickly – try cutting back for
a couple months and putting that extra money toward your debt.
Of course, this strategy may be only part of the solution
for serious debts. If you owe more than you can afford to pay, try negotiating
directly with your creditors. Consumers are often pleasantly surprised at how
flexible their credit card companies, banks and other lenders are when
renegotiating the terms of their debt. For instance, your credit card company
may be willing to give you a lower interest rate, waive certain fees, or even
accept a lesser
amount than what you owe.
Of course, the bank is not just doing this to be nice to
you. It is in the best interest of your creditors that you be in a position to
repay what you owe. After all, if you are forced into bankruptcy, the bank will
most likely be unable to recover what they are owed. And as you know,
bankruptcy is no panacea for the consumer either. That black mark will follow
you for at least seven years, and it is no longer so easy to use bankruptcy to
shield yourself from debt.
It can be difficult to reduce debt, but by carefully
following a budget and negotiating with your creditors, you can get a handle on
your debt and your spending. You will need to learn how to handle debt on your
own. There is no
course on their important skill, but the skills you teach
yourself can help ensure your financial future and keep you debt free.
If you find difficult to manage yourself you can always look
into a debt
consolidation company. Debt management can assist you in
paying off
that debt. When using credit counseling you will make ONE
LOW monthly
payment to the debt consolidation company and in turn they
well as dispurse the money to your creditors.
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