How to Make My Debt Less

Drastically reducing the amount owed to your creditors can improve your personal finances in a major way. Some people spend a huge percentage of their monthly income making debt payments. This results in less income for savings and dealing with unexpected expenses. Learn ways to lessen your debt load and increase your disposable income.

Instructions

1

Buy items when you have the cash. Buying merchandise you can't afford increases debt because you're more likely to use credit cards or financing with retail stores. Save up when you need to make a purchase and use cash instead of credit.

2

Reduce spending altogether. Having extra income isn't an excuse to spend uncontrollably. Reign in shopping and spending and use whatever savings to pay down your debts and reduce your outstanding balances. For example, if you normally spend $300 a month dining out, starting eating at home and put this cash towards your credit card debt.

3

Pay on time. Avert interest rate increases and late fees, which can increase balances, by paying creditors and lenders on time each month.

4

Get rid of your credit cards. Cut your credit and charge cards in half or use a shredder with the ability to destroy credit cards. Removing cards from your possession can eliminate unnecessary spending.

5

Downsize to save money and reduce debts. If house payments and automobile payments prevent debt elimination, re-assess your monthly expenditures and make changes to live within your means. This may require getting a roommate to share household expenses or moving to a place with a cheaper rent or mortgage.

6

Review your interest rate on credit cards. Help pay down your principal quicker by working with creditors to have your rate reduced. This alleviates high interest charges each month, and creditors apply a larger portion of payments to the outstanding balance.