Debt Reduction

How To Get Out Of Debt: Step 3

Step 3: Now you have an organized chart detailing your current debt situation. You can easily see your monthly minimum payments. All you have to do now to begin reducing your debt is to add as much extra money, per month, as you can to the account with the lowest balance. In our example below, the lowest balance has a minimum payment of 25 dollars. You have an extra 75 dollars available for debt reduction, this month. Pay your minimums for all of your accounts, and the pay that extra 75 dollars towards you lowest balance account. Focusing all of your extra debt-reduction monies towards a single account will result if FOCUS. You will see your balance for that account…

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Debt Reduction

How To Get Out Of Debt: Step 2

Step 2: You now have a sheet of paper with your list of debt accounts. Re-order your list so that you have your accounts listed lowest balance to highest balance. Nest, write down your monthly minimum payment for each account. Add your minimums together. This is your total monthly minimum payment amount for all of you debt. This is a very important number to know. Why? Because, no matter what happens during the month, it is vital that you make your minimum payments on all credit accounts. Missing even one payment can cause your interest rates to soar, and even being just a few days late with a payment can cause harm to your credit and add fees and penalties…

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Debt Reduction

How To Get Out Of Debt: Step 1

I have decided to create a comprehensive, step by step plan for getting out of debt. Please note: I will assume that before you begin your debt reduction, you have saved at least 1000 dollars in an emergency fund and that you have decided to stop adding to your debt load. On to… Step 1: On a piece of paper, list every single debt account that you have, including those with zero balances. This list should include credit cards, personal loans, home equity loans, and auto loans. (You may include or exclude your home’s first mortgage.) Next to each account, write down your current balance. Then, write down the interest rate for each account, next to that accounts balance. Add…

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