Dear Readers: Somehow, I missed an entire week of posting. I’m sorry and I hope you haven’t all given up on me. It’s been a busy, busy, busy couple of weeks and posting has taken a hit. However, this week will be jam-packed with posts, I promise! I have a lt of ideas that have been brewing, so I hope you’ll stay tuned!
Getting out of debt can be a long, frustrating process. Knowing the first steps you should take if you’re serious about getting out of debt can make the difference between success and failure.
Step 1: Understand why you got into debt in the first place. In order to start digging yourself out of debt, you need to understand why you went into debt in the first place. You can then see the best way to remedy the situation? Was it excessive spending? Then you need to work on why you spend excessively. Maybe you overspend due to a lack of self control or as a way to boost your self-esteem. Working out those inner issues must be done before you seriously start tackling your debt so you don’t just end going back into debt shortly thereafter. Was your debt situation the result of a unexpected financial crisis, like losing your job or a large medical bill? In that case, you need to work on building up a stockpile of funds so it doesn’t happen again. Which is, in fact, the next step in debt reduction.
Step 2: Start an emergency fund. Before you start putting any of your money towards debt, start stockpiling savings instead. That way, you have something to fall back on if things go awry. You won’t have to go back into debt. Strive for $1,000 in your emergency fund at first.
Step 3: Set up a plan and get to work. There isn’t just one way to get out of debt. Start researching the different methods to find out which method works best for you and your family. Some families prefer a cash envelope system of budgeting. This just doesn’t work at all for others. See what works for you and what doesn’t. A great resource is the personal finance blogging community. There, you’ll find a wealth of information Once you’ve decided, get to work. There’s no point in wasting time, so get cracking.
Do you agree with these first steps? Do you think there are any other first steps you should tak to help you tackle debt reduction?
Hello! Welcome to the home of practical parenting tips that save you money. I'm Rebecca, the creative mind behind this site.
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