7 Steps to Eliminate Debt HTML version

7 Steps To Eliminate Debt – Page 2
Cutting back takes a lot of willpower. If you find it difficult to do so, I suggest you set up
expense jars. They work in a very simple manner: Set up a jar for each main activity, such as
movies, clubbing, restaurants, fast food, gas, and so on.
Every month, put cash into each jar according to your budget. Once the money is gone, stop
that particular activity. If there is money left over, apply it to reducing your debt. As
rudimentary as it may seem, this technique works wonders.
4. Research Money-Saving Options
Look for money-saving opportunities like low interest rates and credit card offers. Before
settling down with a creditor, shop around. Most people are afraid of banks; they think that it
is still as hard to get a bank loan as it was in the early '50s. But today, most creditors are
eager to lend you money. Don't be afraid to negotiate the rates.
If you don't have time to shop around and compare lending rates, you can always check out
BankRate.com. You'll get an instant look at the average rates on various types of cards, as
well as links to the best credit card deals.
Carefully look at these different plans. Some credit cards allow you to cut your interest in half
simply by paying an annual fee of $20. Imagine that: You pay $20 once a year and your
annual interest rate gets cut from 18% to 9%.
5. Take Action
Take these steps today and stick with them. Don't be lazy. Discipline is critical.
6. Don't Close Credit Card Accounts
When you close your credit card accounts, you reduce your options. As long as your current
credit card companies aren't charging you any fees for inactivity, it's in your best interest to
hang onto your accounts.
The problem with closing accounts is that you're at the mercy of whatever credit cards you
decide to keep. That's the equivalent of having to shop at one store no matter how good the
prices are elsewhere.
Plus, when credit card companies notice that you're not using them anymore, they'll generally
send you an offer that saves you money.
Always keep your options open and be ready to switch banks once you get a better offer.
7. Always Pay On Time
The worst thing you can do is make late payments. If you let the deadline pass, you'll pay