A Simple Debt Reduction Strategy to Follow

Don't beat yourself up if you find yourself in deep debt and in dire need of debt reduction help. You aren't the only one out there. With the right directions, and the desire to pay down your debts, you can turn your finances around.

First Step Toward Debt Reduction

The first, and most important, thing you can do is stop using credit to make purchases. Put away your credit cards and line-of-credit checks, and live as if they didn't exist. Get back in the habit of using cash. This will force you to prioritize your spending and recognize which purchases are ìwantsî and which ones are ìneeds.î

Second Step Toward Debt Reduction

You can pay down your debt a lot easier once youíve stopped using your credit cards. It will be even easier yet to pay those debts off if you have enough money coming in each month to live on cash and pay more than the minimum payments due on your credit cards. If you are married and only one person is holding a job, perhaps the other person can consider applying for a job, whether full-time or part-time. You can also consider starting a home based business to supplement your income.

Third Step to Debt Reduction: Spend Within Your Limits

You should always keep your spending within your limits. In other words, donít let your spending add up to more than your income. Easy credit tempts people to overspend without realizing it, leading them into a kind of bondage, e.g., economic slavery. Free yourself from debt by earning enough money to cover your short term needs and pay off your debt in the long run.

Step Four to Debt Reduction: Always Pay More than the Minimum Due

You always want to pay more than the minimum amount due on your credit card statements. At a minimum, try to put aside 10% to 15% of your income just for paying down debts. The more you can pay toward your debts, the better off youíll be. Strive to pay between three and five times the minimum due. One way to start this is by placing the money youíll need at the end of the month in savings each week. The money will add up quickly, and youíll be able to use it to pay off your debts. 

Paying bills on time and keeping your spending habits in check will help keep your debt reduction plan moving forward. Donít forget that payments made more than 30 days late can stay on your credit report for up to seven years. Nowís the time to stop using credit cards, increase your income, curb your spending and pay off those debts!

One of the ways that many people get themselves into a debt emergency is when they have been victims of credit fraud. The best defense to this is a good offence. Subscribe to a quality identity protection site like Creditlock and rest assured that nobody will be able to get new credit cards in your name.