Quick Ways Out of Debt

High amounts of debt can feel like a mountain weighing on your shoulders. Sometimes it feels like there is no escape from the collections calls and piles of bills being left on your doorstep. Paying down debt isn't hard, but it may require a change of attitude towards your debt.

Calculate All Current Debt

Retrieve copies of your credit reports from Experian, TransUnion and Equifax obtainable for free once annually through annualcreditreport.com. Record all debt collections and negative account entries listed. Include contact information for each creditor as well as the balance for each account. Some accounts may not appear on all reports. For example, a collections account could be listed on your Experian credit report, but not on your TransUnion report. If you uncover false or inaccurate information in a credit report, dispute the inaccurate entry with the proper credit bureau, providing supporting documentation. The credit bureau has about 30 days to inform you of the outcome of the dispute or must automatically remove disputed information from your credit report.

Pay Off Collections Accounts First

Collections accounts on any of your credit reports can make it hard to obtain new credit or a loan. Paying off collections accounts as soon as you are able to will help greatly in reducing the impact of the debt on your credit score as well as your wallet. Accounts in collections usually accrue interest on the account daily until the account is paid or considered a "charge-off" by the creditor. Charge-off accounts on a credit report are detrimental to your credit history. Make arrangements to pay off these accounts as soon as possible to prevent further interest penalties or a negative impact to your credit reports.

Find Ways to Spend Less

Budgeting your monthly income will help you save money to help pay down debt. Monitor your monthly spending habits to find out where your money goes every month. Find ways of eliminating unneeded monthly spending and use that extra money toward debt payments. Record your purchases for a month to find unnecessary spending and find ways of reducing or eliminating it. For example, if you run for coffee every morning before work, consider making coffee at home. That money saved on coffee and gas will soon add up to a significant amount over the course of a month. Put the money saved to good use by paying down negative debt that may be listed on your credit report.

Don't Acquire More Debt

The worst thing you can do while you are paying down debt is acquire more debt. Don't obtain credit cards with high interest rates to pay old account debts. You may end up paying more interest in credit card payments than you would just paying off the initial account with cash. Be wary of debt collection consolidation companies that promise to get rid of your debt fast and fix your credit score in a hurry. There are no quick fixes to getting out of debt and these companies usually require you to pay a high up-front fee or high monthly fees for their services. Negotiate and pay off your debt yourself rather than pay high fees for these companies to do it for you, and save money.