There are only 2 ways to get out of debt, make more money or reduce your expenses. Both of those options include discipline and budgeting.
How to make more money?
This may sound silly but sometimes just making a little more money can make your financial life more manageable. Here are a couple of ideas of how to make more money. If you are currently employed maybe there is a conversation to be had with them for a raise. If that is not an option you could look to getting a side job to help ease the financial stress or come up with a small business idea that you could start up. Making more money on it’s own may be a big help to you but if you couple more money with a budget and the discipline to maintain your budget you’ll be out of debt in a shorter period of time.
How to reduce your expenses?
Unfortunately life costs money. Reducing your expenses is usually not most peoples desired way to get out of debt because it may mean lower your standard of living or at least the standard of living you may think you deserve. Sometimes you just have to suck it up and know that the only constant in life is change. What that basically means is that by sacrificing a little bit now you can have a lot more piece of mind an money in the future. It took time to get in to this mess. It will take time to get out. Or does it. If you look at your budget and realize that you are in a position where there really isn’t anywhere to cut expenses than you may have to look at more aggressive measures. Let’s say you have a lot of credit card debt or a home loan you can’t afford or a car/boat loan that is sinking. Sometimes you have to let some of your creditors share the pain with you and try to make other arrangements. In the case of credit cards you can try to negotiate lower payments or even principal forgivess. However most creditors are only interested in negotiating once you’ve missed payments. If you have a mortgage it may be a great time to see if you can refinance to a lower rate or modify your home loan. The bottom line is you need to take a hard look at what is important in your life and budget accordingly. If at the end of the day you can see no way to salvage your current financial situation you can turn to bankruptcy. This will destroy your debt and your credit.
In any wise get out of debt plan it makes sense to set up a sensible budget for yourself. Just because you are in debt doesn’t mean your life has to suck. Make a list of how much money you have coming in per month vs. a detailed list of what you spend you money on every month. What changes can you make to cut your expenses?
Making a budget is meaningless if you don’t stick to it. Make sure that whatever your plan is that you stay strong and follow the plan or the debt won’t go away.