Top tips for getting out of debt

Below are some top tips for getting yourself out of debt.
• Pay back more than you have to. Top up minimum payments on credit cards to bring down the balance.
• If you’re having trouble managing your debt, stop using credit cards until you’ve reached your goal.
• If you want something, don’t buy it unless you have the money. Money saved can go toward debt.
• Cut back on small, recurring expenses.
• Pay off the most expensive debts first. Find the one with the highest interest and work on knocking it down.
• If carrying a balance on debt, make payments as early as possible to reduce interest charges, rather than waiting for the due date. Check your contract for early-payment charges.
• Consider a quality used car rather than new. If you choose new, look for good fuel economy.
• Consider paring back by one vehicle, even temporarily.
• Stockpile groceries when they go on sale and cut out one shopping trip every month or two.
• Get a second job to tackle debt. Put all new money into paying off your debts.
• Track spending for a month and identify ways to cut back. Most people are surprised by what they learn about their spending.
• Put needs before wants.
• Get a consolidation loan. Wrap consumer debts into one loan with one payment at a lower interest rate. This only helps if you develop a budget allowing you to save some money every month. Without savings, you may need to reapply for credit cards and then pile up more debt.
• If you have enough equity in your home, you could consolidate debts into a bond. But if you don’t have a lot of equity, additional bond-insurance costs may be expensive. Talk to someone other than your lender. Avoid using your home as an easy source of money to avoid ending up at retirement age with a lot of debt, no assets and no savings.
• Talk to a credit counsellor for advice.
• Cut back on luxury expenses, such as dstv, garden services and domestic
• Cut back on cell phone expenses where possible
• Try joining a lift club to cut back on excessive traveling expenses.
Should you require the assistance of a debt counsellor please contact DebtBusters on 0869 99 06 06 or have a look at our website www.debtbusters.co.za.

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