How to Lose Your Debt

Having large amounts of debt can feel overwhelming, and because of the ease of obtaining credit cards, many people are experiencing debt stress. Acquiring debt doesn't seem to take long in today's economy, but removing it may take many years. There are many ways to lose your debt without having to resort to bankruptcy. With patience, willpower and some financial guidance, you can take the bull by the horns and begin following a path toward being debt free.

Instructions

1

Reduce your debt by creating a budget. Make a list of your monthly expenses and your income. Look at your spending habits and make necessary changes to help you save money. Bring your lunch to work, dine out less and use coupons. Shop at discount food markets and bring a calculator to keep track of what you are spending.

2

Contact your high interest credit card companies to ask that they lower your rate. Speak to a supervisor; if he declines your request, try again next week. Let your creditors know your situation. Tell them that if you are unable to renegotiate terms, you'll have to declare bankruptcy. They would much rather receive some payment than nothing at all. Some credit card companies may even offer programs to help get rid of debt.

Pay more than your minimum payment each month. If you have lower-rate credit cards, take advantage of any balance transfer promotions they may offer.

3

Speak to a debt consolidation specialist to help lose debt. There are many nonprofit consumer credit companies that can talk with your credit card companies to reduce your rates significantly. They will assist you to pay off your accounts within five years, however, you will need to close your accounts altogether. If you are spending a fortune on the interest rates of your cards, you will still have a lower payment with more money going toward the principal.

4

Bring in more money. Get a part-time job, donate plasma, sell unused items on eBay or Craiglist, and if you love children, babysit for money. You can also organize a garage or yard sale for extra cash to get rid of your debt.

5

Sell your new car and find a reliable used car.

6

Quit going out to movies; you can rent free ones at your public library. Stay away from the malls and the next time you want to buy something, ask yourself if it's something you really need.

7

Shop around for lower car and house insurance. You may be surprised at how much you can save, especially if you've used the same company for many years.

8

Cut up your credit cards but keep the ones that are paid down open. You may receive promotional rates later and you can transfer your higher rate cards to get rid of debt.

9

Talk to a lawyer about bankruptcy if you have no other options.