Take on the “Get Out of Debt” Challenge

Over 40% of American families spend more than their monthly budget, which means that they are accumulating debt. It’s a terrifying scenario but many of them just can’t get their finances together in order to spend less and save money. The bottom line is: They need debt help.

Getting out of debt, particularly credit card debt, is extremely difficult; it is a severe challenge but it can be done. Most families need guidance, some “know-how” to get started and then they need discipline and gumption to stay the course. Here is some guidance but those that require debt help have to find it in themselves to continue on the path of financial redemption. That can’t be taught; it’s an individual urgency only obtained by those who desperately want to be debt free.

To get yourself started on our “Get Out of Debt” challenge, we have compiled a list of priorities to accomplish in your first stage of revamping your personal finances and reducing your debt:

1. Don’t charge — If a person can’t pay off their total credit card charges each month than they must stop charging. Keep cards at home; use cash to prevent overspending on pointless items and don’t buy on impulse. A credit card is not a financial tool used to buy whatever a person wants. It should only be used in emergency situations, especially when an individual is looking for debt help.
2. Purge the store cards — They are not worth the temptation unless a gas card gives great rewards. One or two major brand cards provide enough flexibility for a person to charge only necessary items. And don’t be fooled by special offers at retail stores. Sign up for one of their brand cards and save on that day’s purchase may sound financially smart, but future purchases bite back with high interest rates.
3. Save money —  That sounds easier said than done but if a person stops buying coffee in the morning, or lunch at work or any number of things that aren’t necessary than it does become easy. Don’t treat money like it’s supposed to be spent, treat it like it needs to be saved. Collect change, turn up the air conditioner or turn down the heater, use the car less to save on gas; get inspired and as the money piles up use it to pay off credit card debt.
4. Start paying more than the minimum — Most people in credit card debt only pay the minimum each month, but that leads to a snowball effect – the balance keeps growing because of interest rates and what should take a year to pay off becomes two or three years with hundreds of dollars being wasted. If possible start paying more than the minimum; it saves money in the end.
5. Don’t buy store brand items — Inspect the ingredients on the store brand items compared to name brand – they are mostly identical. Many brand name producers charge more because of advertising and marketing costs, which are passed on to the consumer. Being loyal to a brand is silly, especially today when loyalty is not on the minds of the producers of items; they want profits. Don’t be emotionally attached to a brand, be loyal to saving money.

This may seem overwhelming at first but consumers can start with these few steps and then expand and implement more financial boundaries to their lifestyle. It’s worth it; so take the “Get Out of Debt” challenge and find out how it feels to not to be burdened by bills and debt.