Getting Out of Debt- How to get out of debt
The simple way out of debt is to stop borrowing money and spend less than you earn. That is easier said then done, but it is the only way to get started.
My battle with debt started at the beginning of August, 2007 with debt totaling $265,618.76. You can see my progress with the ‘debt snowball‘ listed in the right column (updated monthly).
Simple Steps to Get Started
- Stop borrowing money
- Make a budget- Why you should make a budget; How to make a budget
- Turn your junk into cash (get to know Ebay or Craigslist)
- Create an emergency fund (typically $1,000 is a good number to start with)
- Live below your means
- Track your spending and keep your budget updated
- Make a visual reminder to track your debt
- Make yourself accountable (get a friend or relative to help, start a blog, or both!)
- Be patient and don’t give up
I have found the hardest part of this is the last step. It is really easy to get excited, make brilliant plans, come up with strategies for success, and start out with the wind at your back and great hope for the future. The problem is, you can manage your finances perfectly for a couple of months and find that you have only paid off a few percentage points worth of your total debt balance. This can be very discouraging! It is exactly what I have gone through. Creating this Website is what really helped me to overcome the discouraging times and keep at it. That is why finding a source of accountability is critical to success.
