by Marcus Bentley Wise

Created on: April 18, 2010

To solve your money problems you need to use three steps to get to where you want to be. It will not be easy and you will find out that along the way you will have to give things up and face some hard decisions. But in the long run it will be worthwhile.

First you have to evaluate exactly what situation you are in. Now it is always surprising to find exactly how many people do not have the slightest idea of where they are. They normally know what is coming in and the basics of what is going out. As to the full existent of how much or little debt they are in is always a little gray. Once you have found out and made a list of every thing that you have going out, every thing that you have coming in and every thing that you own. Then you can make a plan.

Second, you then need to make a budget and stick to it. Once you have the details you have to budget for what is coming in. Allocate the right amount of funds to the right places to get your debts down. You need to know what assets you have that you could sell. Outgoings that can be reduced or stopped. And savings that could be made. Then calculate what moneys you have spare to go toward reducing the most costly of your debts. This normally for most of us is the credit card or store cards that we have. And form of credit that is easy to access is usually costly. Take paying for insurance every month. It is easy to handle as you do not have to find one lump sum. But over the period of a year it will cost you a lot more.

Third you have to reduce your spending. A rapid reduction of spending and a new drive to paying of bills. Purchase only what you need, stop eating out, Cancel all subscriptions and shop around. You need to live within your means and not above them. This is often the hardest thing to do as we are so often use to just having what we want when we want it. But if you are in the situation that you are looking at finical meltdown, it makes your choices a little easier.

You can try and make more money. Sell what you can for the best price that you can get. If you shop around for the best deal in insurance do not accept the first offer if selling. Go out and get another part time job at the weekend or on the night. Take in washing and ironing, or walk people's dogs.

And if things are so bad go to the banks and tell them of the situation you are in. If you need an over draft get an agreement on one. If you need to consolidate your debts do so. If you need help ask. If you go to a bank with a clear plan for paying of your debt and some of the interest they will listen.

Debts can also be crippling emotionally. You lay awake worrying about them. But taking logical steps to control and reduce debts you will find that your world does become a happier place.

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