There are several steps you need to take in order to get out of debt. The first step to take before you can even consider becoming debt free, is to discipline yourself to not buy anything you cannot afford. This means, no finance, no credit cards, no loans and no overdraft. If you do not have the cash to pay for an item there and then, don’t buy it!
This may sound like you will have a boring life and you will never again be able to purchase anything you want, but you couldn’t be further from the truth. Fair enough, you will probably go through a period of your life without all of the latest gadgets and top-of-the-range clothes, but in a few months or years time, you will be able to afford anything you want.
Find a credit card company that is offering an interest free period, and apply to transfer all of your existing cards to this lender. There are loads out there so shop around. There are also lots of web sites that do all the hard work for you, such as moneysupermarket.com, that can find you the best deal.
Once you have transfered all of your existing cards to the new provider, cut up the rest of your cards, and when the new one comes from the new lender, cut this up as well. This will stop you being tempted to spend money you haven’t got.
Now you only have one card to pay off each month, take the minimum payment required and, if possible, pay at least half of that again on top. If this is not possible, work out how much disposable income you have and put this towards the payment.
If the debt is not cleared by the end of the interest free period, find another card issuer that is offering a similar deal and follow the same process as above. Don’t forget to cut up any new cards that you receive. Continue this process and your debt will be gone in no time!
In a similar light, stick to any loan payments you may already have and again, if possible, pay more than the minimum required monthly payment.
Before you know it you are debt free, and you will be able to put the money you were spending on debt into a savings account, allowing you to purchase anything you want in the future.