Personal Debt Reduction Strategies

In the current economic situation, personal debt is commonplace. It is not unusual for someone to be thousands and even tens of thousands of dollars or more in debt. Those in this situation should use a myriad of strategies to reduce their personal debt and emerge back in financial health.

Add to the income

For some, their expenses are too great for them to pay off their debt without adding to their income. You may be able to work extra hours at your job. You may need to get a second job. You could consider doing some freelancing work such as writing articles on the Internet. You may babysit or even mow lawns for a little extra cash. You may choose to have a yard sale or sell some things through Think of all of the ways you may be able to earn a little money.

Spend less money

It is not always possible or easy to increase your intake of money. You may still be able to reduce your debt if you reduce the amount that you are spending. Of course, the general gist is that you must spend less money on a monthly (or otherwise regular basis) than your income. The remaining money can go to the debt.

The first step in this is knowing how much money you have coming in from all sources. Once you have this knowledge you should put together a budget. First you need to input all of those items, which are necessary for you to spend such as rent or mortgage and food. Remember that in many cases you may be able to reduce even necessary costs such as by spending less on food. Add in other expenses, and cut down as much as you can. You want as much money as possible to go to paying off of debt. Keep track of all expenses and stick to your budget. Adapt as necessary.

There are many ways that you can spend less money. First, think about what is truly necessary by evaluating all of your costs. Do you really need as expensive a cell phone plan as you have? You want to cut down on unnecessary expenses. For instance, many people spend a lot going out to eat, which is generally much more than the cost of eating in. You may save money by cooking more. Do not buy clothing or other items that you do not need. Try to look for lower cost activities such as free music festivals instead of pricey concerts. If you have trouble resisting the urge to buy things then avoid the malls and other shops at which you like to shop. Remove yourself from e-mail advertisement lists from your favorite stores. 

You can save money on household costs. Try to save money on electricity by turning off lights, televisions and other items when not in use. You can buy energy efficient appliances. Do not waste your money in gambling or other ways in which you generally lose.

You can also often spend less on the same exact things. Use coupons. Look for sales. Shop for bulk items in less expensive places like Costco. Look to see if you can get a better deal on something on the Internet. Shop during clearance.

Even if personal debt seems overwhelming, it can be eradicated, even if slowly and steadily. Keep focused on this goal while trying as many of the above strategies as possible to emerge debt-free.