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