| Many of us are more concerned about | | | | 6. Consider re-financing your home if |
| credit than debt. That's because the | | | | interest rates are in your favor and it |
| majority of us have a relatively easy | | | | makes financial sense. |
| time getting credit. In the mail, we are | | | | 7. Beware of debt-consolidation loans. |
| bombarded with pre-approved credit card | | | | In theory, the loan sounds appealing; a |
| applications and most of us carry around | | | | lender agrees to pay off all of your |
| a fistful of cards. This causes the | | | | bills by making you one big loan. The |
| mentality of being able to think we can | | | | lender handles all the creditors and you |
| buy as opposed to what we owe. | | | | make only one monthly payment to the |
| Here are some steps to consider | | | | lender. |
| alleviating debt problems: | | | | 8. Don't hide from your creditors. Let |
| | | | them know you are having financial |
| 1. Face the problem. Until you admit you | | | | problems and express a sincere desire |
| have a problem, you are not prepared to | | | | and commitment to pay your bills. In |
| fix it. | | | | most cases, a creditor will be flexible |
| 2. Make a plan. Review the last six | | | | and work with you to design a repayment |
| months of your spending habits to figure | | | | plan that you can meet. |
| out just where your money goes. How much | | | | 9. If necessary, seek professional |
| money comes in each month and what do | | | | advice. There are nonprofit counseling |
| you need to pay off debts? | | | | offices across the country that offer |
| 3. Curb spending habits. Find ways to | | | | assistance to people who are having debt |
| reduce spending, and make no new major | | | | problems. To locate a counseling center |
| purchases. Stop using credit cards. If | | | | near you, contact: The National |
| you can't bear to cut them up, tuck them | | | | Foundation for Consumer Credit. |
| away in a safe deposit box. | | | | 10. Pay more than the minimum for credit |
| 4. Consider using your savings, if you | | | | card bills. You will have to make a few |
| have any, to pay off certain debts. If | | | | sacrifices for this (giving up a few |
| your savings account is paying 5 percent | | | | luxuries), but the increased payments |
| interest and you are paying 20 percent | | | | will save you hundreds or thousands in |
| interests on your credit card, you are | | | | interest payments. |
| getting way behind. | | | | 11. As a last resort, you can file for |
| 5. Can you increase your income? Maybe | | | | bankruptcy. Your credit record will hold |
| you can put in extra hours at work or | | | | this for ten years which might make it |
| get a part-time job during the weekends. | | | | impossible for you to obtain credit even |
| Do you have any assets you can sell? | | | | if you can afford it. Do a thorough |
| Extra furniture, a car you really don't | | | | research on bankruptcy and find out if |
| need? If you have a lot of personal | | | | it's the best option for you, what it |
| belongings you can part with, you might | | | | entails and its end results. |
| hold a garage sale. | | | | |