Tips to Begin to Reduce Debt

by : A.C. West

With finances becoming tighter and prices on gas and food increasing, debt reduction has become an idea that is on many people's minds. If you are wondering how you are going to pay your bills each month and wish that you could reduce your debt at the same time, then read on for these tips to give you some ideas on how to make this dream a reality.

The most important step to take is to have a positive attitude and realize that you can do this. Even when your situation is looking bleak, just think about how great it will feel to no longer receive credit card and loan statements and not needing to worry any time the phone rings wondering if it is a creditor. You will have so much less stress and anxiety and you will even money in your savings account for emergencies or "rainy days." Think of all of the positives about reaching your goal. Make a list and write it down so you can look at the list any time you are feeling down about your financial situation.

Next, make a budget. Write down each and every penny you spend even if it is for a cup of coffee or a piece of candy. You need to know where every cent is going. Use your budget to see where you can eliminate or cut back on some expenses. Find ways to save money any way you can.

Finally, after reviewing your budget, use the extra money you have found through reduced or eliminated expenses towards your debt reduction. Tackle on debt at a time, starting with either the smallest balance or the highest interest rate, and work towards paying the balance in full. Once you have one paid off, continue to the next debt and repeat the process.

Just remember to keep a positive attitude and work towards your goal of becoming debt free. Debt reduction is not going to happen overnight but with persistence and determination you will be able to reach your goal!