How to Beat Debt
- 1). Make a list of all of our debts, from your monthly mortgage to your credit card bills. Add up the required monthly payments on all of your bills.
- 2). Prioritize your debts according to the interest rate, starting with the highest interest rate and working your way down to the lowest. Make all of your required payments as usual, but be sure to direct any extra funds to paying off the highest interest debts.
- 3). Create a family budget if you have not already done so. A realistic family budget is the cornerstone of any debt elimination program, so it is important to create a budget with as much detail as possible.
- 4). Get a handle on what you are really spending by carrying a small notebook with you on your daily errands. Use your notebook to record every purchase you make, from your morning cup of coffee to your monthly grocery purchases. This exercise can help you identify holes in your budget and redirect that money to paying off your debts.
- 5). Consider taking on a second job if your monthly debts are eating up a large portion of your monthly income. If there is still no extra money in your budget after cutting back, the best choice is to bring in some additional money. Just be sure that every extra dollar you make is applied directly to the debts with the highest interest rate.
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