Finding one’s self deeply in debt is rather common place these days. If this is you then you are just one of millions of people who need debt reduction help. The kind of help you need may depend on your situation. Many people can help themselves and get out of debt on their own, but it will take a long term commitment to do so. The first step, just getting started on a debt reduction plan, can be the hardest part for most people.
If your debt is getting out of hand chances are you may not even know how much you owe and to whom. Many times we find ourselves just writing checks to pay the bills that keep flooding our mail boxes each month, not really paying attention to how much is owed, what the interest rate is, or even how much that interest is costing us each month.
The first step to getting a handle on your debt is to simply list out all your outstanding debt for one month on a piece of paper. This list should as thorough as possible and include the creditor’s name, contact information, how much money you currently owe, the monthly minimum payment, and the interest rate as well as the amount of interest paid each month. With credit cards the monthly minimum payment and interest paid can change from month to month, so keep that in mind.
Once you are done listing out all your debts look them over closely and begin to prioritize them is order of importance. For instance making the monthly mortgage payment is probably more important then some of the other debts you may have. Any back taxes will also be of vital importance simply because of the power that the federal and state taxing agencies have.
This list will give you a good idea where you stand as far as your debt is concerned and allow you to come up with a plan to start paying it down. If your payments fit within your monthly budget then it is just a matter of paying them down over time. If the payments are more then your budget can handle then it may be time to start negotiating with your creditors to get more favorable payment options. This may also be a good time to start looking at debt consolidation or debt relief companies that can help negotiate better terms with your creditors.
If you do need to find debt help through a debt consolidation agency then be sure to do your homework before signing any type of contract. Check these companies reputation very carefully because you need one that will represent you fairly to your creditors. It’s rather easy to find good recommendations and testimonials on the internet as well as checking with the Better Business Bureau to find out if the level of customer satisfaction is good for these companies.
Remember it’s your money and it’s up to you to determine how it can best work for you. Don’t ever let a creditor tell you how to use your money.