How to Get Out of Debt Without Falling Behind on Your Bills

As many Americans battle just to pay their monthly bills, the fear and reality of falling into debt becomes overwhelming for many.

One of the biggest challenges many individuals come across is a means to get out of debt without falling too far behind on their present financial responsibilities.

First and foremost, those in a financial bind need to come to the realization that there is work to be done, they can get out of their financial hole, and there are ways to prevent this going forward.

Organize and Budget

Among the steps that can and should be undertaken include:

* Tally up the list of debts you have and put together a budget.
* Work your way from the smallest balances up to the largest balances. Some will argue that you should go in the opposite direction; however, paying off one bill at a time will give you a better feeling about reducing your overall debt.
* Do not fall behind on your current bills. Take whatever amount, even if it is just a little more than the minimum payment required, and put it towards your debts each month. The goal should always be to pay more than the minimum so that you pay off the debt sooner rather than later.

The last point is important given that falling behind on your present bills like rent (if applicable), utilities, etc., will send you into further financial chaos.

Avoid Piling More on Plastic

One of the knee-jerk actions is oftentimes to put more and more on plastic and say you will worry about paying off the balances tomorrow and not today. The problem there is that you are just adding to the debt issue.

Another action that should be immediately taken is curtailing unnecessary spending.

Take a moment and think about the extra money that is spent toward things like coffee runs on the way to work, shopping for things you really do not need, and reducing costs for things like cable television and other entertainment items.

In the event that you find yourself in a position where you are having trouble getting out of debt without falling behind on your bills, consider taking on extra work. Whether it is a part-time job or trying to get overtime work at your present full-time job, the extra money will assist you in more quickly reducing your debt.

As a last resort, there is always the option of filing bankruptcy; however, that should be considered only after trying a number of different options.

The main thing to keep in mind with the possibility of a bankruptcy filing is the long-lasting impact such an action has. Consumers that file for bankruptcy are locked in for years with the realization that they will have trouble securing loans, for starters.

So, you have a little bit better idea now of how to bring down your debt, but will you remember all these different means?

It is a good idea to jot down in a notebook the ways you will lessen your debt, then check monthly or even weekly on how productive you are actually going about it. Take stock of:

● Priorities – Put together several lists, each indicating your weekly, monthly, quarterly, and annual income and expenditure. Review the lists and determine which expenses can be decreased, or which you can do away with altogether. Prioritize your bills and expenses, if you cannot pay all of them, make sure you at least pay the minimum on each, or get help with them. Neglecting to pay a bill not only leads to more interest charges, but you also add more damage to your credit report.

● Shop around for mortgage savings – Given this is likely to be your largest monthly bill, shop around. You could consider the option of a fixed-rate mortgage, which has the plus side of letting you know what you have to pay in advance. Try your best NOT to fall behind on this payment, as you could accrue large fees and even potentially lose your home.

● Look into possible benefits – Research to see whether or not you are eligible for any state or private benefits. For those that are unemployed, elderly, or disabled, you could be eligible for some benefits, or even able to obtain some goods and services for a discounted rate.

● Consider selling some items – It never hurts to look into selling some items that you can part with. Yard sales, turning to sites like eBay, and placing ads online or in local publications are great ways to let people know you have items to sell. Unless something is of great value or sentimental to you, consider it potentially up for sale so you can bring down your debt.

● Don’t be afraid to ask for assistance – One of the hardest thing to do for many people in debt is to ask family and friends for assistance. Whether it is personal pride or not wanting to turn one’s financial problems over to someone else, many people in debt fail to reach out for help. If family and friends are not able to help you out, they will tell you so. The simple fact is you will never know if you do not ask.

When all is said and done, stay true to your present bills, work meticulously to bring down your current debts, and learn from the mistakes of the past so that they are not made again tomorrow.

With 23 years of experience as a writer, Dave Thomas covers a wide array of topics from Louisville air conditioning to how to secure a home loan.

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