The task of getting out of debt can seem daunting and may cause you to procrastinate. While a one-size-fits-all strategy will never work, a plan that addresses your individual needs and specific circumstances will help you rein in out-of-control spending and lower your debt. An unrealistic goal, no matter how well intentioned, will only lead to frustration and ultimate failure. Success will happen when you have a positive mindset and a plan of action that is truly attainable. Here are some simple steps to help you stay motivated, keep moving forward and reach your ultimate goal of being completely debt-free.
A Good Reason to be Debt-Free
The odds of successfully accomplishing a goal increases when the expected outcome is acknowledged and a can be measured. In the case of a desire to reduce your debt, the most important question to answer is why you want to be debt-free. A nagging in-law may not be incentive enough to push you to do the hard work of debt reduction. But reasons that are less superficial can provide meaningful incentive to reach your goal.
- Eliminate financial hardship
- Invest more
- Plan for retirement
- Send kids to college
- Increase financial security
- Improve credit scores
- Reduce stress
Put It Down On Paper
Seeing the reality of your troubled financial picture on paper will make it more tangible and for some people easier to commit to a solution. Take a quick inventory of your income vs. expenses — the first step in creating a budget. The process will point to troubled spots and, hopefully, direct you to ways of modifying spending.
Seek Out Manageable Solutions
Most people who are looking for a solution to a debt problem don’t have the luxury of simply paying it off. Other options run the gamut from following a strict budget to enrolling in a consumer debt management program to filing for bankruptcy. With the speed and depth of information available on the web, it’s never been easier to do your own research into just the right solution to meet your needs.
If you decide to hire a company to negotiate your debt, do your research. Consider other people’s experiences by entering the company name with the word “complaints” into a search engine. Read what others have to say. It’s an important decision that involves spending money that could go toward paying down the debt.
Create a Workable Timeline
If your strategy goes as planned, you can calculate when your goal will be reached. Being able to see the progress on a calendar or spreadsheet will give you incentive to keep pushing forward. Having a realistic timeline to follow is essential to avoid being disappointed. Be sure to see our online debt payoff calculators to see how much time it will take to pay off your debt based on the amount of money you can afford to pay.
Have Reasonable Expectations
Paying off debt is never as easy. Don’t become discouraged if a setback happens; the timeline can easily be modified to take into account any emergency. When the difficulty has been resolved, it’ll be time to get back to business. It may take years, but it will get easier as you experience a new way of living.
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