Repair Your Credit Profile

Don’t beat yourself up if you find yourself in deep debt and in dire need of debt reduction help. You are not the only one in this situation. With the right directions, and the desire to pay down your debts, you can turn your finances around.

Step One to Debt Reduction: Put Away Those Credit Cards

First and foremost, stop relying on credit for ordinary purchases. Put away your credit cards and line-of-credit checks, and live as if they didn’t exist. Try paying in cash. Using cash will remind you there is a difference between wants and needs.

Step Two to Debt Reduction: Increase Your Income

Once you have stopped adding to your debt, you need to work on reducing it. It will be even easier yet to pay those debts off if you have enough money coming in each month to live on cash and pay more than the minimum payments due on your credit cards. If your spouse doesnít work, consider the possibility of them working at a full or part-time job. You can also earn extra cash by starting your own home based business.

Step Three to Money Debt Reduction: Live Within Your Means

Your total spending should always be within your limits and never, never amount to more than your total income. Easy credit tempts people to overspend without realizing it, leading them into a kind of bondage, e.g., economic slavery. Try to build up your income to the point where you can live on cash and free yourself from your long term debt.

Fourth Step Toward Debt Reduction

Commit to paying more than the minimum owed on your credit cards. You should aim to use 10% to 15% of your income for debt repayment. Once youíve started meeting your goals, set higher ones. For example, paying three to five times more than the minimum amount due. To make sure that you can achieve this, put away some savings every week, even if they seem small. Youíll be surprised at how quickly the money adds up, and how quickly your debts go down. 

To keep your debt reduction strategy on track, pay your bills early and do not spend beyond your income. Also remember that late payments beyond 30 days will affect your credit rating for up to 7 years. Take charge by putting the credit cards away, earning more income, controlling your spending, and paying down your debts.

We often recommend hiring a debt settlement professional to people who come seeking our advice. For those with little time or energy to devote to cleaning up their debt this can be a great idea. An even better idea (and quick way out of debt) is to do it yourself. If you’re interested in that you must check out Zipdebt. With this one guide I’ve seen amazing results with my clients!

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