Get rid of debt today by following these steps!
The most difficult part about getting rid of debt is creating a realistic goal and continuing to execute on it every day. If you’re faced with a lot of credit card debt, don’t tell yourself that you want to become debt free within 1 year if you know it’s not realistic. Keep in mind that there will be unforeseen expenses (car breaks down, home improvement, medical emergencies, etc) that you might run into.
So how do you even begin to get rid of your credit card debt? Is it to create a budget? A spending journal? Or maybe even canceling your gym membership? The answer: none of the above.
The first step to get rid of debt is knowing how you got into debt in the first place!
Here are three of the most common reasons that people get into debt:
1. Keeping up with the Joneses: Nowadays, it’s so easy to purchase anything you want online at the comfort of your own home. You can basically buy anything you want online, from flat screen TV’s to groceries. It’s easy to have the mindset of, “buy it now, and worry about it later”. It’s a different feeling when people don’t see the purchase coming directly out of their checking account. Many consumers feel the need to get the latest technology or keep up with the latest fashion trend. To get rid of debt after following this path, it will take a lifestyle change to ensure you don’t continue on this path. This mindset can lead to a destructive path if you don’t proceed with caution and leave you with unpaid credit card debt. At this rate, I guarantee you that your items will end up on ebay to pay off your debt!
2. Spend now, pay later: It’s the nearing the end of the year and you can’t wait until you get your bonus check. You’ve worked extremely hard up to this point and you feel like you deserve something nice. You make the purchase on your credit card, thinking that you’ll get rid of your debt as soon as get your bonus check. This is a common problem that’s facing many debtors. They spend money that they don’t have in hopes that it will come later.
3. Rewards Points: This may sound silly, but people are enticed with reward points. “Earn 3x points when you use your credit card at the grocery, gas station, or parking meters!” Credit card companies know these are common destinations where people NEED to spend money. They encourage consumers to charge it to the plastic to earn points. Unless you are the type of consumer who pays off their balance in full every month, it doesn’t take a rocket scientist to figure out it’s not worth it. The average mileage/reward points you earn is around $0.013 cents. To get rid of debt, you need to simply understand that it’s NOT worth it to charge the purchase on your credit card.
Get rid of debt, once and for good!
You probably fall into one of these three categories. Once you realize how you got into debt, make a plan not to follow the same road. The next step is to create a monthly budget, start a spending journal, and take steps to trim down on your every day expenses. If you find yourself having serious debt trouble and are unable to continue to make the monthly payments, you can get a free debt analysis to see what your options are.
-Kevin
I couldn’t agree more with rewards points, and I think I’ve been distracted by them at some points, too. It sounds like such a great deal on the surface, but you’re really spending a lot just to get a little back. I think some people don’t realize how little they are getting back in return, too.
I’m shocked at how many blogs there are regarding credit card use and how to maximize reward points. Even more surprising is the fact that they are promoted as personal finance blogs.
Great tips – getting on a budget and controlling your spending is the first step.
#2 used to be a big one for me – if I knew I had money coming, I couldn’t stand waiting. I would spend money I needed for other things because of the anticipated windfall. Which was fine until a check got delayed or was less than I thought it would be.
These are good lessons for everyone!
To eliminate debt, we must first restructure our financial blueprints. This is the source of how we handle money.
People always remain restless when they have multiple debts. At present it’s a big problem in all over the country. There are many strategies and tips generated to reduce these debts. Conscious people are now aware about debt reduction. They are always concentrating on their outstanding payments. Timely payments help a person to get rid of this debt trap.