When You Have Too Many Debts What Do You Do to Pay Them Off?

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Paying off debts can seem like an arduous and overwhelming task at times. While it may seem impossible, it is possible to get a handle on credit problems. Assessing your debt load, establishing a budget and working to get your credit payments under control are all essential steps in the process.

Things You'll Need

  • Calculator
  • Monthly income statement
  • Budget
  • Telephone
  • Money management software (preferred)

Consider Your Position

  • Determine your monthly income. Income can come from a number of different sources, including a job, any rental properties one may have, investments, even child support. Once income is determined, it's time to move on to the next step.

  • Mark when your bills are due. Late fees and other charges add up and hurt your credit even more. Be mindful of due dates and make whatever attempts you can to meet obligations before those dates.

  • Calculate a budget. If your findings reveal you have enough to pay your debts, sticking to a monthly budget would be the best way to ensure this gets done. However, if the findings are such that the debts outweigh the income, more help may be needed.For more information on budgeting, see Resources below.

  • Follow that budget. All that hard work and planning will do no good unless you have the discipline to stay within your means.

Seek Professional Help

  • Consider professional credit counseling. It may be that you could negotiate with creditors all by yourself for more favorable terms. However, it may be better to seek the help of a local credit counselor. These professionals can work with you and help you find the relief you need.

  • Check the local phone book for credit counseling services. These are usually readily available in any medium- to large-sized city. They will work with you on a manageable repayment plan. This may involve sending in one lump monthly payment to the counseling service or another clearing house for distribution to creditors.For more information on credit counseling services, see Resources below.

  • Enroll in personal finance classes. Your credit counselor may offer these classes or should be able to recommend a good place to start looking.

Tips & Warnings

  • Check all terms with credit cards before activating them.
  • Be careful of credit offers as even applying can affect credit ratings.
  • Make sure all financial information is secured by only dealing with reputable agencies.
  • Photo Credit Baptiste Franchina
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