Debt Reduction and Debt Elimination Tips

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Studies have shown that financial problems and household debts are one of the top 5 causes of divorce and a survey carried out in the early part of 2008 had 75% of people sayng that money worries were their number one cause of stress. With the credit crunch showing no signs of going away and household bills and unemployment rising this figure is not likely to improve soon. This page is intended to give some ideas that might help if you find yourself relating to the above and even if  it proves helpful to just one person it will have justified its position in cyber space.

The First Priority
To get out of debt the first and most important thing to do (and i would advise not reading further down the page until you have done this) is to understand your current financial position. This is simple to do and just requires you to spend time writing down all your income and expenditure so you can see exactly where your money goes. To help you a basic household budget calculator is available to download and print off on the useful tools page. 

Moving Forward STEP ONE
Now that you have done the home budget calculator you should be able too see exactly where you money is going and whether you are living within or outside your income. If you really do want to reduce your debts now you have the information to see where you can cut back your spending to increase the money available to pay the debts off quicker. Ask yourself questions like do you really need sky sports/movies etc. If you read through the money saving tips page with your household budget calculator by your side you might identify a few areas where you can reduce your monthly expenditure.
Something to think about " A survey by uswitch showed that someone with an average credit card debt of 1812 paying the minimum 2% each month would take 29 years and 2 months to repay the credit card debt and pay 2858 in interest. If the minimum repayment was increased to 3% it would take 15 years to pay off and the interest would drop to 1257" 

STEP 2
So having done the budget calculator and looked to see where budget savings can be made you can see whether your income is greater or less than your expenditure. If you are stll showing less income than expenditure, it means that your debts will continue to grow and unless you are aware of some financial factor that is going to change this, i would suggest a trip to the citizens advice bureau to speak to one of their professional debt advisors about the situation. They offer free advice and their debt advisors can assess your situation and devise best course of action for you.
 
to be continued

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