Become Debt Free In The New Year
Brian B. Williams
November 27, 2007
The leaves haven't even turned brown and Christmas ads aren’t yet bloating your morning newspaper. But NOW is the time to plan your New Year's resolution to get debt free.
Paying off debt is one of the most popular resolutions among Americans. It takes time to assess where you are and where you want to go financially. Last-minute New Year's resolutions are hard to maintain. Starting months ahead by writing down a budget and assessing your debts helps you study the best options for debt relief.
Losing weight is a popular New Year's resolution. Think about all the things that fatten your finances like high-interest credit card debt. Eliminating credit cards and the associated debt would mean less weight on your budget.
Assess Your Debts
Find out how much debt you have in comparison to savings. On average, Americans take on too much debt while not saving anything. Assessing your ratio of debt to saving will give you a starting point for your debt help.
Find The Best Plan For Debt Relief
Once you have a handle on your debt situation, investigate the best debt-relief methods. The worse thing is to scramble for credit repair when your money woes reach the crisis point. You may entrust your money to dubious firms that take your cash but do nothing to help eliminate your debts.
Debt relief must be tailored to your unique debt situation. For example, a homeowner can opt for a home equity line of credit (HELOC) to consolidate various debts. A debt consolidation loan without collateral can be used to combine debt, especially credit card debt, at a lower interest rate. Debt settlement firms can negotiate a reduced debt balance as you pay less on your combined debts or a credit counseling agency can help straighten out a credit mess. You need time to research your various options.
Set A Strict Budget
Like a corporation assessing its finances after a 12-month fiscal year, your resolution to live debt free can put you on a strict financial regimen. A written budget is key to succeeding at being debt free. This may mean eliminating costly activities such as getting rid of cable, traveling less, eating out less and attending fewer movies.
Figure out how much money you can devote each month to paying off debt. You can stop and examine any big-ticket expenses upcoming in 2008 such as major vehicle maintenance or family vacations. You can build savings into your budget to fund large expenses instead of using a credit card.
Monitor Your Debt Management
Track your debt-relief efforts. A good idea is to create a scoreboard counting the dollars off your debt. Get a bunch of posters and markers to make it a fun family activity. The scoreboard should be in a prominent place in your home, such as the refrigerator door or bathroom door. The scoreboard is a constant reminder of the importance of a debt-free life. Update it as often as you see fit, perhaps monthly or weekly.
Of course, you don't have to create a scoreboard to document your progress in paying debts. But you do need some constant reminder of how you are doing. If not, you may become distracted by other matters and forget about let your debt-relief goal.
Start Today
Preparation is important in getting out of debt. Don't wait until Dec. 31. Any New Year's resolution without a plan will not work.
Paying off debt is one of the most popular resolutions among Americans. It takes time to assess where you are and where you want to go financially. Last-minute New Year's resolutions are hard to maintain. Starting months ahead by writing down a budget and assessing your debts helps you study the best options for debt relief.
Losing weight is a popular New Year's resolution. Think about all the things that fatten your finances like high-interest credit card debt. Eliminating credit cards and the associated debt would mean less weight on your budget.
Assess Your Debts
Find out how much debt you have in comparison to savings. On average, Americans take on too much debt while not saving anything. Assessing your ratio of debt to saving will give you a starting point for your debt help.
Find The Best Plan For Debt Relief
Once you have a handle on your debt situation, investigate the best debt-relief methods. The worse thing is to scramble for credit repair when your money woes reach the crisis point. You may entrust your money to dubious firms that take your cash but do nothing to help eliminate your debts.
Debt relief must be tailored to your unique debt situation. For example, a homeowner can opt for a home equity line of credit (HELOC) to consolidate various debts. A debt consolidation loan without collateral can be used to combine debt, especially credit card debt, at a lower interest rate. Debt settlement firms can negotiate a reduced debt balance as you pay less on your combined debts or a credit counseling agency can help straighten out a credit mess. You need time to research your various options.
Set A Strict Budget
Like a corporation assessing its finances after a 12-month fiscal year, your resolution to live debt free can put you on a strict financial regimen. A written budget is key to succeeding at being debt free. This may mean eliminating costly activities such as getting rid of cable, traveling less, eating out less and attending fewer movies.
Figure out how much money you can devote each month to paying off debt. You can stop and examine any big-ticket expenses upcoming in 2008 such as major vehicle maintenance or family vacations. You can build savings into your budget to fund large expenses instead of using a credit card.
Monitor Your Debt Management
Track your debt-relief efforts. A good idea is to create a scoreboard counting the dollars off your debt. Get a bunch of posters and markers to make it a fun family activity. The scoreboard should be in a prominent place in your home, such as the refrigerator door or bathroom door. The scoreboard is a constant reminder of the importance of a debt-free life. Update it as often as you see fit, perhaps monthly or weekly.
Of course, you don't have to create a scoreboard to document your progress in paying debts. But you do need some constant reminder of how you are doing. If not, you may become distracted by other matters and forget about let your debt-relief goal.
Start Today
Preparation is important in getting out of debt. Don't wait until Dec. 31. Any New Year's resolution without a plan will not work.
Print
Email
