Independent Debt Advice

Getting debt under control takes hard work and commitment. Independent debt advice involves strategic planning, addressing the real issue behind problem spending and making a pledge to adjust spending habits, all of which can help you find relief without resorting to quick-fix debt solutions, which could end up hurting your credit score.

Talking to Creditors

In lieu of using a debt settlement or debt consolidation company, consider contacting creditors yourself. Credit card companies and other lending institutions may be sympathetic to the financial hardships of customers who are upfront about their situation before defaulting on payments. A lender may offer a debt repayment program that reduces the interest amount and/or monthly payments.

Budgeting Your Spending

Knowing exactly how much you make versus how much you have to pay for essential expenses, like housing or insurance, can help you discover ways to save money so you can pay off our debts faster. In a budget, it is also important to note how much you spend on miscellaneous items such as eating at restaurants for lunch or buying music online. If you notice you are spending more on non-essential items than you intend, think of ways to reduce or eliminate the expense. For example, if you purchase food for lunch, consider packing your own instead.

Knowing Your Debt

To get a good hold of your debt, you must know your debt. Along with a budget, notate the total amount you owe each creditor, your current monthly payments, the monthly payment amounts you can afford, interest rates and the anticipated amount of time it will take you to pay off each debt. Creating a timeline can help you keep track of your progress and create a list of priority debts. Instead of making the largest debts priority debts, financial expert Dave Ramsey suggests making the smallest debts a priority. Once you pay off the smaller debts, you will have extra money to use towards the larger ones, which will help you pay the larger debts faster.

Planning for the Future

Out of control spending often begins with one purchase beyond an individual's means, and it is easy to fall back into bad habits. Stick with a budget even after you pay off your debts to help you build up a savings account or plan for a large expense that you can pay for with cash, such as a vacation.