5 Principles for Debt Management

Debt Management - 5 Principles to help you get yourbe amazed at how much money you spend on things
debt under control!IntroductionDebt consolidation andyou want, and don't really need. The smallest things,
refinancing have become thriving industries in Americasuch as that $3 cup of coffee every day, can slowly
these days. American personal debt is at the highesteat away at your finances. This will help keep you
rate we've seen. Creditors are more and more willingfrom getting further in debt. Your budget should define
to give out credit cards, or let people easily qualify forhow much money you'll send to each of your creditors
home equity loans so they can refinance ormonthly and how much you need for bills, and how
consolidate debt. Not that refinancing is bad, but oftenmuch is left for discretionary spending. Try limiting your
times, we feel that since we've reduced our interestdiscretionary spending to things you can buy with
rates, we can afford "a little bit extra" credit as a"pocket cash". This may be hardest thing you've ever
reward.BusinessWeek says that total household debtdone, but you won't get further in debt if you only
in the US was more than 100% of our disposablespend what you have.3. Pay off the debts one by one.
annual income last year. The average person has
more than $8000 in credit card debt.The bottom line isMaintain minimum payments to the rest of the debts,
that our personal debt is growing at an alarming rate.but pick the debt with the highest interest rate, and
You can now charge your fast food meals at manysend extra payments to pay it off. There is a proven
restaurants, paying interest for years on somethingpsycological benefit to being able to take a debt off of
you consumed in one sitting. Many people have takenyour list.4. Consider debt consolidation or debt
steps to address their debt problems, includingrestructuring and possibly refinancing your home
consolidating debt to lower interest rate cards, or tomortage.
home equity loans, or at worst case the dreaded "B"Lower your credit card debt by 70% by consolidating.
word, Bankruptcy.5 Principles of Debt Management1.With interest rates down, it also may be time to
Create an accurate assessment of your debt situation.refinance your home mortgage loan and cut your
monthly payment. You can get free mortgage loan
Make a list, chart or whatever you're mostquotes at LowCostLending. When you refinance,
comfortable with, of all your debts. Be sure and includemake sure closing costs and other fees don't outweigh
the amounts, interest rates, and expirations datesthe savings in your monthly payment. Another option is
(especially on any no-interest for ## days type loans).to get a Home Equity Loan. Home equity loans are
Be sure and note any old accounts that you've gotgood because they allow you to deduct the interest
"laying around", such as that department store crediton your income taxes. Remember though, new credit
account that you opened to get the 15% discount. Youis not a license to incur new or more debts. Once
can now get a free credit report online. You shouldyou've transferred a balance by consolidating, or
make sure that you've got a credit report and FICOrefinancing, don't add more charges to the old account.
score from each of the 3 national credit bureaus:If you've got a lot of open accounts, you may want to
Experian, Equifax, and TransUnion. The FTC advisesclose some of them, but you shouldn't necessarily
monitoring your CREDIT REPORT activity ON ALL 3always cancel the old account. Having a good
BUREAUS. Order your 3-bureau report from today. Ifpayment history with a few existing accounts can be
you've got bad credit, paying down your debts is ofbetter for your credit record than many cancelled and
utmost importance!! Click here if you need helpnew accounts.5. If necessary, get help.
understanding your credit score. Depending how badYou may choose a credit counseling service, or debt
your score is, you may also consider additionalcounseling and debt help service to help with each
measures to repair your credit.2. Make a budget andstep of your debt solution. Credit counselors can add
stick to it!accountability to your debt solution, and also serve as
Making a budget helps keep from increasing youra source of encouragement. They are used to dealing
debt, while you're trying to pay it down. Be specific andwith people with bad credit or poor credit, and can help
detailed in your budgeting. Except for emergencies,you create a custom debt solution. They can suggest
you should only be spending what is accounted for inmoney lenders that might be more willing to make a
your budget. Some people have found it helpful toloan to someone with a lower credit rating. Once you
keep a 30 day log of their spending. Carry a littlestart reducing your debts without incurring new ones,
notebook, or some index cards with you, and writeyou'll start to see your credit score rise.
down everything you spend each day. You'll probably