Money Saving Monday - Getting Out Of Debt

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It's no surprise to me that many people have debt when the economy is the way it is. It's sad but true. Almost daily we get new offers for credit cards or loans in the mail as I'm sure others do too. It makes me angry. These companies make so much money off of people who for the most part are just trying to keep their heads above water.

Debt can come from many avenues including but not limited to hospital/medical bills, credit cards, personal loans, vehicle loans, and mortgages. While I don't feel that a mortgage is a bad type of debt to have, it would definitely feel nice to not have it as well.

About a year or so ago I came across Dave Ramsey and his system for getting out of debt and building wealth. I know I've talked about it before but seriously if you haven't checked his site out yet then you are really missing out! Dave calls his system of debt payoff a "debt snowball" -which is listing your debts from smallest to largest and paying the minimum monthly payment on everything but the smallest debt. You then put every dollar you can find on to that smallest debt until it is paid off. Then you move on to the next smallest debt and instead of just paying that minimum monthly payment you will also pay the total monthly amount you were just paying on the previous debt. Still following me? I know that sound kind of confusing but really it isn't. Maybe it's just my way of explaining it!

Maybe at this point you are thinking your budget is so tight you can't afford to add anything else to your smallest debt's minimum monthly payment -it's ok, I've felt like that before too! The good news is that majority of the time if you keep looking you will find it!

Here are a few ways that can help you get out of debt:

1. Evaluate all of your current monthly bills. Are some unnecessary? Perhaps your cable could be cut off and subscribe to Netflix or pick up a Redbox movie instead. For us, our cable, internet, and home phone are bundled together for a total of $138 a month. Sucks right? The internet is a necessity in our house but the cable and phone aren't...so we are planning to cut those soon...that would add almost $80 to our debt snowball a month! Check all of your bills and see what can go (at least for until your debt is paid off)!!

2. Sell stuff. Right now I'm sure we are sitting on all kinds of things that could be sold for this purpose. Maybe it's time I do a little inventorying and get some stuff out of our house!!

3. Embrace a frugal lifestyle. Sure you may want the most expensive clothes you can afford but are they necessary? Could you find better prices on day to day shopping trips and add that money to your debt fund? Clip coupons if you have the time and shop sales! Don't cook 5 course meals at night...SIMPLIFY, SIMPLIFY, SIMPLIFY!!

4. Create additional sources of income. Find odd jobs to do, babysit for friends, create and sell items...the possibilities are endless here!

5. DO NOT ADD MORE DEBT TO WHAT YOU HAVE!!! This is a big one!! Once you have set your mind to getting out of debt do not cave in and increase your debt! NO MATTER WHAT!

*It may be easier for your family if you set up an additional checking account that you can deposit your extra money into until it's time to make that debt payment. That way you won't spend the money on something else!

*Talk about it with like-minded people. Come up with new strategies together and keep each other focused.

*Stop trying to keep up with everyone else and focus on making a better life for your family.

*Pray, pray, pray! Let God know what is on your heart so He can help show you the path to take!


Please take a moment and check out Dave Ramsey's site to find more information on setting up a budget, emergency funds, getting out debt, and building wealth!!

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