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"Let no debt remain outstanding, except the continuing debt to love one another, for he who loves his fellowman has fulfilled the law." (Romans 13:8)
1. Are you paying bills in no particular order? Housing should be the number one priority each and every month. After the mortgage or rent payment, vehicle, groceries, and utility bills should fall in line. Secured debts are obviously more important, since they can be taken away from you through foreclosure and repossession. Unsecured debts will need to be paid too, but the importance of food, shelter, clothing, and transportation always trump the credit cards. Make sure that you are paying the most important things first, so in case of a set-back you don't find yourself in a bad situation. 2. Are you only making your minimum payments? If you are only making the minimum payments each month you are falling into the trap that the credit card companies want you in. Minimum payments basically go directly into the companies pockets, so you rarely see your balance come down. All you are doing is paying interest and fees. You will never get your credit card paid off doing this. If you want to see your balances come down you need to at least double the minimum payments. Now paying the minimum payment isn't always bad, since it can keep you current, eliminate late fees, and help you through the tough months. But if you want to start eliminating credit cards from your life you have to make more than those minimum payments to do so. 3. Do you have a budget in place? Many people feel that budgeting is just a waste of time, but in all actuality budgeting will show you exactly where your money is going and benefit you financially. It will stretch your dollars further and help you track your spending. Budgeting is a very useful tool that should be implemented in your home every month. You will be surprised by how much you spend and you will be even more surprised by how much you save if you set up a reasonable budget that the whole family can live within. If you decide not to budget it will be a waste of money, not time. 4. Have you prepared for an emergency? This fund is not really an option; an emergency is bound to happen sooner or later. If you are not prepared for it, you will only be digging deeper into the financial hole. You'd hate to have to pile on more charges to the credit card, especially when you can prepare in advance. Even it is just twenty dollars per pay cycle that you save, this will add up and save you big time when that time of emergency comes. 5. Are you charging your purchases instead of paying in cash/debit card? I have always said that credit cards equal convenience. It is a lot easier to throw the credit card down than it is to write out a check or count out your cash. This is definitely what the credit card companies want you to believe. How often do you use your credit card on those insignificant purchases when you could have just as easily used cash or even your debit card? This raises your balances and costs you more money in interest. Why not use cash, check, or a debit card and save yourself some money? Using this method of payment will not only save you money, but will help you live within your budget too. It may not be as convenient, but it sure is worth it. No one likes having debt, but the truth is many of us are riddled for years attempting to pay off various bills. In order to get your financial outlook straightened out you must attack debt as fiercely as possible without putting yourself in a worse situation. With these five tips you should be able to effectively clear your debts and live life the way it should be. Joe Larson is one of the certified Christian credit counselors for Family Life Credit Services, a nationwide Non-profit debt relief agency since 1986. The goal of FLCS is to strengthen and encourage families and individuals through Christian faith-based financial counseling. They offer financial educational materials free of charge as well as the opportunity to work with a certified counselor in your area of need.
http://www.familylifecredit.org/
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