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Step 1
Pay off your credit cards. It can be tempting to allow credit card bills to pile up, but you really need to keep them paid off. Always try to pay more than the minimum amount, so the interest doesn't eat up most of your payments.
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Step 2
Don't charge if you can avoid it. It's much better to buy things when you have the money, or wait until you can afford them. Putting things on your credit card so you can have them now will only lead to a mounting debt.
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Step 3
Get rid of your credit cards. Once you have your cards paid off, cancel them. The average American has six or more credit cards. This is just asking for debt and credit problems. Keep one if you must, but pay off and cancel all your others as soon as possible.
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Step 4
Limit your buying. Just because you want a plasma TV doesn't mean you really need one. Keeping up with the Jones' isn't as important as keeping your bills paid. Don't waste money on luxuries unless you have a large amount of disposable income.
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Step 5
Keep all your bills paid up. If you have the option, pay a little more than what is due. That way, you will have a reserve built up to get you through tough times. Don't let your bills slide. If your bills are already behind, make any payment you can afford, and get them paid up as fast as you can.
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Step 6
If you want to use a credit card to build your credit rating, buy an item with the card, and immediately pay it off. Never buy an item if you don't have the cash to pay for it. Using the card and paying immediately will help to improve your credit.
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Step 7
Be frugal. There's nothing wrong with using coupons or buying second-hand. Saving money is always smart. Get deals whenever you can. Go for generic instead of name brand items. Too many people get into debt because they feel a need to buy overpriced brand name items when they could get a generic equivalent for much less.
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Step 8
Start a savings account. Try to put away at least a little money every month. Some banks, HSBC for example, allow you to start a savings account with no minimum balance, no need to have a checking account with them, and very low deposit requirements. The sooner you start saving, and the more often you do it, the more interest you can earn. It's a good idea to have this savings to get you through during hard financial times.
