Americans are up to their eyeballs in debt. At no time in our nation’s history have more people been stuck in the nasty quagmire of burdensome debt. So, here we will discuss methods for getting out of debt as quickly and easily as possible.
In order to do this the right way because there are no debt elimination tactics that will really work for you without completely destroying any chance at having good credit for many years to come, we need to look at how people get into debt in the first place.
There are no two ways about it we get into debt by spending too much and making too little. If you never spend more than you make it’s not really possible to get into debt.
This means that instead of going out at wondering if you can really afford that nice shiny, shiny new car that you stop and say “what would happen if my income took a hit?” “Could I still make the payments with ease?”
If you don’t like the answers then you should likely not buy that car. In fact you should never buy a car on credit. What you should be doing is saving for a new car every month. Then when you can walk in and pay cash you go buy it.
Sure, I know you’re probably saying ‘who does this guy think he is, no one does that”. Well, someone has to tell you the real truth and not sugar coat it, then what you choose to do with it after that is on you.
If you do insist on buy a car on credit at least buy a used car. Then you might not be losing money the second you drive it off the lot. You see when you buy a new car the moment you take possession of it and they hand you the keys it’s now a used car and will drop 5%, 10% and even up to 20% of its value right there on the spot.
If you do insist on getting a new car then make sure you get gap insurance so that if you get into an accident and the cars totaled you won’t still owe up to 20% because you lost 20% of the value when you took possession of it.
One of the other ways of getting out of debt is to take a real hard look at your housing situation. If you’re in a house either owning or renting and the payment or rent is more than 15% of what you take home in a month in income than you’re paying more than you can afford.
Yes, I’m fully aware that all the so called experts say that you should spend no more than 33% of your income on housing. But that’s why so many people following their advice to the letter are filing for bankruptcy.
People look at both partners income or look at the 33% of just their one income and then they or their partner lose their job or their hours get cut back as is happening to millions of people in America and BOOM that supposed 33% is now 66% of their income and they simply can’t afford it.
When you do it my way, even if you’re income gets cut in half you’re housing is still only costing you 30% which is below what the so called experts say is acceptable.
The best thing you can do to get out of debt is to use common sense. Don’t spend more than you make, it will catch up to you sooner or later and it won’t be a laughing matter then.
With the right guidance you really can do it faster and easier than you may have thought possible.