Make a Debt Payoff Plan

One of the scariest parts of this whole plan is figuring out how much you owe. A lot of people don’t know because they’re afraid of adding their debts up, but you can’t get yourself out of a nasty financial situation without figuring this part out. Instead of focusing on the negatives, try to make this into a positive by knowing exactly how far the light at the end of the tunnel is.

Sit down and calculate that number right now.

Are you prioritizing your mortgage? A debt mortgage specialist should help you refinance it so you would focus on your credit card balance instead. This means you’ll pay for longer, but the extra money can help you tackle your debt faster.

Have you spoken to your creditors? Sometimes, all you have to do is ask for a lower interest rate and they could help. This won’t guarantee results, but you never know.

Go for either the debt avalanche or debt snowball method. The debt snowball method works like this: you’ll pay minimum payments on all your credit cards except for the lowest balance (balance, not interest!), where you’ll pay as much as you can. Repeat this ad-nauseum until your debts are paid off.

The avalanche method works in the opposite way, focusing on your biggest one first.

But keep in mind that a lot of people find the snowball method easier because it encourages you to keep going whereas the avalanche method might take longer and a lot more power of will.

Do you have a perfect plan for paying off your debt? Then move all of it into a new card that offers 0% interest for 12 to 18 months. Other than the balance transfer fee, you won’t have to worry about anything for those months, saving a ton of money in the process.

Again, this should only be done if you’re sure you can do it within that time limit.