| Home | Free Articles for Your Site | Submit an Article | Advertise | Link to Us | Search | Contact Us |
This site is an archive of old articles


vertical line

A Do-It-Yourself Debt Reduction Program

Need a debt reduction program? You are not alone. Here are 5 tips on reducing debt that you can do right now.

1 Ė Knock Off Using Credit

If you havenít done this one, then this is the place to start. Put the credit cards and line-of-credit checks under lock and key, and operate as if you donít have them at all. Figure out how to make more income and pay cash instead. This is the single most effective action you can take.

2 Ė Never Commit to Spending More Than Your Income

When you pay for an item with credit because you donít have the cash, you are committing your future income to pay the credit company. Then you experience economic slavery. Ask yourself if you just want the item or if you really need it to increase your production of income. If you need it, figure out how to make the cash to pay for it over a short period of time, rather than buying on credit. Find ways to increase your income and use it to pay both current expenses and pay off credit debt.

3 Ė Always Pay More than the Minimum Payment Required

Your debt reduction program will be most effective if you carve out a minimum of 10% to 15% of your income. Use this money to reduce debt. Set a target of paying 3 to 5 times the minimum monthly payment on every credit card. Set aside some of the payment money every week until the statements arrive. Itís always easier to save small amounts over 4 weeks than pay a big bill all at once.

Your credit card payment strategy should also include paying more on the highest interest rate card. Another strategy is paying off low balance cards as fast as possible. After you pay those cards off, the money you were paying on those cards can be paid against the highest interest rate cards.

4 - Never Pay Late or Spend Over Your Limit

Do not destroy your debt reduction strategy by getting hit with late payment or over-limit fees of $25 to $39 on which youíll pay interest. Plus, if you pay over 30 days late, that black mark stays on your credit record for 7 years Ė a harsh penalty to pay.

Recently a Vice President of a U.S. bank stated that over 24 Billion dollars was paid out in interest, late fees and over-limit fees last year on credit cards. Do you think the credit card company really minds if you pay late or go over your limit? If they didnít want you to spend over the limit they could have declined the charge, right?

5 Ė Cut Back on Expenses

Reducing debt requires as much cash as possible, as fast as possible. Look closely at where your income is being spent and cut back on any expenses that do not contribute to the production of more income. Before you spend, figure out how much money that purchase is going to bring back in to you, your family or your business.

TIP: If you are a business owner, always promote your business to everyone Ė donít cut back on that activity. Just make sure you are getting more sales from your promotional activities than what it costs to promote.

Correctly managing the money in a business or household to ensure its survival takes more than a debt reduction program, but this is a great place to start. There are other steps that you can take to increase income, pay bills on time, have cash reserves for emergencies, increase profits and pay yourself more money. Who doesnít want that, right?

Submitted by:

Sandra Simmons

Sandra Simmons, President of Money Management Solutions has years of experience helping business owners and individuals manage their money to achieve financial freedom. Watch the FREE 5-minute demo video on her website www.MoneyMgmtSolutions.com.




ARTICLE CATEGORIES

Auto and Trucks
Business and Finance
Computers and Internet
Education
Family
Finances
Food and Drink
Gadgets and Gizmos
Health
Hobbies
Home Improvement
Humor
Kids and Teens
Legal
Marketing
Men
Music and Movies
Online Business
Parenting
Pets and Animals
Politics and Government
Recreation and Sports
Relationships
Religion and Faith
Self Improvement
Site Promotion
Travel and Leisure
Web Development
Women
Writing



http://www.articlesurfing.org/finances/a_doityourself_debt_reduction_program.html
Copyright © 1995-2016 Photius Coutsoukis (All Rights Reserved).