How to Make a Debt Chart

If you want to manage your money wisely, learning how to keep track of personal debt is a worthwhile endeavor. It's easy to owe more than you make without realizing it if you don't have a system in place to manage your spending habits. One way to monitor your expenses is through visual means. You can make a debt chart to have a clear picture of how much you owe your creditors and how long it will take to bring your balances to zero. In addition to helping you stay organized, a debt chart can also provide a source of encouragement as you see your balance shrink with each payment. There are many ways to create a debt chart; choose the one you're most comfortable with and that visually resonates with you.

Instructions

1

Calculate how much debt you owe. Write down -- in a notebook or using your computer -- the name of the creditor, the amount of debt owed and the number of months you want to pay down the expense. This may (and, if possible, should) exceed the minimum amount required by the creditor. Calculate the amount of your monthly payment per creditor.

2

Lay the poster board on the floor or on a table in front of you. Determine the number of rows you need to create a chart; use one row per creditor. Measure equal distance between the rows and draw a straight line across with your pencil.

3

Cut the red and green construction paper into squares that number the amount of months you want to pay off your debt. Make sure the squares are of equal size by first measuring with your ruler and marking with your pencil. Write on each red square the words "Owe" followed by the monthly payment amount. Write on each green square "Paid" followed by the monthly payment amount, the name of the month and the year. Do this for each creditor.

4

Label the top of each row with the name and brief description of the creditor. For example, "Main Street Bank credit card." Also include the total amount you owe, such as "$5,000. Glue the red squares along the corresponding rows until you have one continuous red line.

5

Glue a green square over a red square with each payment you submit. If you pay more than the monthly amount you allotted in your budget, write the difference between the increase and the monthly payment below the regular payment line. Do this for each creditor each month to have a debt chart in which you can easily see your debt obligations disappear.