Do you lie awake at night stressing about how to pay the minimum amounts due on a burgeoning mountain of consumer debt? Unforeseen medical events or car emergencies can be the tipping point for many consumers attempting to manage debt obligations. Using credit cards for discretionary spending on the other hand can only result in a consumption hangover that’s paid for through mounting interest obligations and sleepless nights. The only way to succeed in reducing credit card debt is to have a clear goal and specific steps to meet that goal. Follow these recommendations from financial professionals to begin digging yourself out of debt once and for all.
The only way to solve a problem is to define it. Compile a spread of all of your consumer debt obligations including outstanding balance and minimum payment due. Arrange these in order from the smallest balance to the largest. Total the sum of debt. The elimination of this figure is your ultimate goal. Set a date by which you would like to realistically become debt free. Divide the number of months between now and your target date and divide that number by the sum of your debts and the resulting number is the amount you need to commit each month to eliminating your debt. The only way for this plan to succeed is to have a solid commitment to refrain from accumulating additional discretionary debt.
This monthly sum that will now be targeted toward debt reduction will come from a reduction in monthly discretionary spending as well as a part-time seasonal job where all of the earnings are earmarked towards your goal of being debt free. You didn’t land in debt overnight and making the personal sacrifices and mustering the self-discipline to achieve your goal will not be easy, but will be worth it in a multiple of ways.
Think twice about all of your discretionary spending. Plan to forego that overpriced morning cup of designer coffee and daily lunches with coworkers. Take advantage of the awesome deals offered by Groupon coupons and shop the bargains available through Nordstrom Rack when there are items that you absolutely need. Make a conscious choice about the difference between items that you actually need and those you would like to have. Best of luck on reaching your goal to become debt free.