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Step 1
To get out of debt fast, pay off your highest interest rate credit cards and loans first. Make minimum payments on all but your highest interest rate debt. Figure how much extra money you can pay toward the high interest rate debt and pay as much every month toward the debt as you possibly can. If you have a small debt that you can eliminate in a few months, an alternative strategy is to pay the small debt first, thereby freeing up the cash that you would have otherwise spend on the minimum monthly payment for that debt. Use the extra money that would have been spent on minimum monthly payments to begin paying down your high interest debts.
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Step 2
Stop using credit. Let me repeat: stop using credit. This may seem obvious, since in order to get out of debt you must stop incurring it. Realize that paying your high interest debts is futile if you continue to rack them up.
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Step 3
To get out of debt fast, you will need to find extra money to pay toward your debts. Create passive income streams online by writing on sites like eHow and other content sites. Sign up for a free blog to promote your articles and raise ad revenue. Take on a second job or find a work-from-home job (jobs in transcription, translation and customer service all offer telecommute opportunities). Cut all of your unnecessary spending in the form of meals out, cable television (take up reading!), club memberships, etc. Think about what you really need, instead of what you think you want.
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Step 4
Be frugal. Buy clothing second hand. Peruse the "free" category on craigslist. Shop at dollar stores and local produce stands. Eat more veggies and grains and less meat and processed foods. Buy and prepare food in bulk, then freeze in single or family size portions. Keep waste to a minimum.
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Step 5
Sell what you don't need. Ebay and craiglist are excellent resources for selling items you don't want or need. Kid and baby gear sells especially well, as does clothing in good condition. Sell that treadmill or elliptical machine that's collecting dust in your living
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Step 6
Stick to your plan. You might find that you begin to enjoy a simpler life with less gadgets and gizmos. Realize that your own personal worth is not tied to how many items you own. Being free of debt, and getting to a point where you can build real wealth, is worth far more than a few lousy television shows. Take the opportunity to get out and do healthy things for yourself like spend time with friends, take walks, read good books and build community.
Comments
Rockney said
on 11/23/2008 Great advice! 5 stars!