Do you have any idea that you are in debt? Not being able to meet the minimum monthly payments is the first way some people realize they are having problems. To avoid being in this undesired predicament, you should take stock of your situation every 3 months. Tally all of your debt including credit cards, loans and mortgages. It’s not imperative, but your mortgage probably should be included.

So start by listing all the details of each account, including: name, rate, outstanding amount, and minimum payment. Put them in order from the highest interest rate to the lowest rate. Calculate the total amount that you owe and work out the minimum amount you can pay per month. Don’t be too concerned with what you owe. It make take some time however anyone can elimiate the debt. That means you, too.

So the first step will be to track your spending habits. I have talked about this in a previous post so I will not go on about it.

If you followed the first step, you should now understand how your purchasing patterns have affected your financial future.Changing your habits now will prevent you from continuing to incur debt that may result in your inability to recover.The time is now to make that change.

It is important that you don’t worry too much about your total amount of debt.The most important thing is that you have dedicated yourself to change. {So make a firm decision to only purchase necessities with your credit card from this point forward, and pay off your credit card bill in full at the end of each credit cycle. Save for big purchases rather than buying something you can’t afford now.

You also need to decide how much extra you can pay on your debts or investing. This will be dependent on your finanical goals. What are your goals? I dohope that you have some for today and tomorow! I recommend you take a portion of your surplus fundsand pay down your debt if that debt has become a problem. With today’s economy, this advice is easier to give than it has been in the past.

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Tags: debt, personal finance tips
Filed under: Money tips