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How to Get Out of Debt

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Published on Oct 1, 2010

Watch more Credit & Credit Cards videos: http://www.howcast.com/videos/408617-...

If you've dug yourself into a hole with one too many impulse buys, this guide will show you how to crawl back into the black and get debt free.

Step 1: Create a debt list
Create a comprehensive debt list to plainly see how much you owe in loans, cash advances, credit cards, and anything else you owe money on. Knowing exactly where you stand is the first step to reclaiming control over your finances.

Tip
Display the list in plain sight and cross off each debt paid to track your progress and stay motivated.

Step 2: Set a budget
Set a budget and try every strategy you can think of in order to stick with it. Decide which purchases and expenses are priorities, and which are nonessentials. Then, cut the nonessentials.

Tip
Avoid huge sacrifices that will add more stress to the family, but sacrifice luxuries when you can. Eat in rather than going out and learn to have fun for free at home, in the park, or at the beach.

Step 3: Increase income
Increase your income by picking up a part-time job or selling those unused electronics, clothes, or tools you own.

Step 4: Work from highest interest rate
Pay down credit cards and loans with the highest interest rates first, and move down the list.

Step 5: Be patient
Be patient and consistent, and you'll once again get your head above water.

Did You Know?
The U.S. Treasury printed a $100,000 gold certificate for less than a month between 1934 and 1935.

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