How to get out of debt.

Getting out of debt might be strenuous for a lot of people but if you are in it you must get your self out of it.

There are three basic steps involved:

• Stop acquiring new Debt: If you are thingking of getting out of debt, never aquire a new one. Being in Debt is already a big challenge so why get sunk in the more. Note that once you make up your mind to free yourself of debt you must take that desicion not to acquire a new one.


• Establish an emergency fund: Save every extra cah you get. Destroy all credit cards and if you pay subscribsions for cable tv, cancel or reduce it (you are at work most times, so why pay full package). Are you subscribed to a nearby gym, cancel it. Do not tell yourself you need all these extras to make your LIFE comfortable. Reduce these extra expenses or stop them totally. You must then save regularly. Why save before paying off debt? Because you will need the experience and you would be able to cope with unexpected expenses. Keep this money in liquid but not easily accesible. It is not for beer, shoes, food etc. It can only be used when your car dies or you break an arm in a game of football.


• Implement a debt snowball: After you’ve stopped using credit, and after you’ve saved an emergency fund, then attack your existing debt. Attack it with vigor. Throw whatever you can at it. Many people say to pay your high interest debts first. There’s no question that this makes the most sense mathematically. But if money were all about math, you wouldn’t have debt in the first place. Money is as much about emotion and psychology as it is about math.Order your debts from lowest balance to highest balance. Designate a certain amount of money to pay toward debts each month. Pay the minimum payment on all debts except for the one with the lowest balance. Throw every other penny at the debt with the lowest balance. When that debt is gone, do not alter the monthly amount used to pay debts, but throw all you can at the debt with the next-lowest balance.

Do these three steps and you would find yourself debt free in no time