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Being in debt is a lot more common than you think. If you are debt, it can control your thoughts. Getting out of debt doesn't have to be difficult but it will take time depending on how in debt you are.
Debt is a hotly debatable topic. We see on the news about companies in debt and going out of business, or the government is in a deficit that means debt. Then there are the commercials about getting out of debt, or many different types of Nationwide Debt Reduction Services.
Debt can happen for various reasons and it's not because of frivolous spending. I feel there are 3 common reasons for debt:
Let's face it college is expensive. Not everyone has a college fund to pay for it all, or able to pay out of pocket. You can help with the cost of college by applying for scholarships.
Owning a home can be expensive as well. Instead of rent, you have a mortgage. If you live in an apartment and something breaks and you call your landlord to fix it. When you are a homeowner, you are in charge of paying to fix things when they break. This can drain your bank account or your savings depending on what the emergency is and how much it costs.
This is similar to the above example. Not everyone has health insurance in this country. Even if you do have insurance, that does not mean everything is covered at no cost to you. Depending on the insurance you have, you can have a large deductible, and/or co-pay.
Getting out of debt doesn't have to be scary.
One way to get out of debt faster (depending on how in debt you are) is to use a debt reductions company. I'm not 100% sure how they work as I've never used one. Based on the commercials I've seen, they work with all of the companies you are in debt with (if more than one) and you end up paying one payment every month that is lower.
Another way to work on getting out of debt is to have a very strict household budget. It's not easy and it can take awhile to get used to a new way of living but it can be done.
To start doing this, make a list of everything you spend money on. Budget every single penny you spend. I do think monthly just because I freak at the idea of not having enough money to last all month or to overdraft one of our bank accounts. I drive my husband nuts with it but guess what, towards the end of the month he is afraid we are broke and I'm like no we have X amount left. Then suddenly he's happy with my tight control on the budget.
Once you have a list of exactly what you are spending money on, you know where you can start to cut back on things. A $5 Starbucks sounds like no big deal. However that $5 adds up quickly. So does eating out for dinner or lunch.
You can save $5-$20 a day but simply making your coffee at home, and packing your lunch for work. Let that sink in for a minute. $20 a day can add up fast and help you get out of debt faster. The same for ordering out or going out to dinner. I'm a big lover of going out to eat. I actually budget that into the household budget and it becomes part of my “fun money”. We each get a set amount of “fun money” a month.
I hope these tips help you on getting out of debt. Do you have your own tips that I didn't share? I'd love to hear them.