How to Become Debt Free Fast

Becoming debt free has become more important as economic conditions in the world continue to fluctuate. The process of getting rid of debt can be a tenuous one, but it is possible.

Instructions

1. Cut 'em up. That's right, cut your credit cards in half, with the exception of one for emergencies only. This doesn't mean you are closing your accounts; you are just denying yourself access to them. This first step must be taken before any others because if not, once you have paid off your old debts, you will only feel tempted to give yourself permission to overspend again. Credit cards are the most common form of debt and the most dangerous. Many people buy on credit, never thinking about the large bills that are to come later.

2. Draft a plan on paper. List everyone and every company you owe money to. Write down dates that accounts were opened, what you owe, how far behind (if at all) you are and contact information for each company/person. You must have a plan so you know exactly what you owe and just how deep in debt you really are.

3. Call your debtors and try to make a deal. Most debt collectors or even regular companies just want what you owe. More often than not, they are willing to settle up with you for a fraction of your actual debt. In fact, some companies will go so far as to offer up to 75% off of what you owe them in exchange for some payment, any payment at all. Call or write to the companies that hold debts in your name and ask them if they would consider a settlement offer. If they accept, be sure you pay as soon as you are able to. If you don't hold up your end of the bargain on the deal, chances are you won't be offered a settlement opportunity again.

4. Divert as many extra funds towards paying off debt as possible. It may mean a few months of eating a home instead of in a fancy restaurant or skipping over getting an entirely new spring wardrobe. However, that money you spend on extras really adds up, and you may find that paying off a bill every time you have some extra money will get you out of debt faster than you ever dreamed possible.

5. If your debt is overwhelming, get help. Some people are in such a deep pit of debt, it doesn't matter how much they scrimp and save to pay it off, they will never get there. At this point, it may be prudent to find a reputable debt consolidation agency that can help you consolidate all of your bills into one affordable payment. This option might not be as fast as some of the others, but is sound and reliable and is a surefire way to get out of debt without drastically altering your current lifestyle.

Resources

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