Reducing Your Debt

There are various ways to tackle too much debt. But here are a few suggestions to get your started:

Understand your expenses - Produce a list of expenses. Then categorize them into fixed (mortgage, car payment, etc); Necessary but not fixed (utilities, phone, fuel); Not Necessary (clothes, dining out, etc.)

Create a budget - Include all items you just listed. Unlike government, you cannot exceed your income.

Lower expenses - Think about how to pay down more debt. Cut down on the Not Necessary items and put the extra to reducing debt.

Increase your income - although not easy, consider how to increase your take home pay. Consider raising your exemptions at work. This reduces the taxes taken out each paycheck. Use the extra cash to pay down debt, not to pay for increased expenses. DON'T SPEND THE EXTRA MONEY ON NOT NECESSARY ITEMS!

What not to do - Don't borrow from home equity or 401(k) to pay for short term items. It may seem easy and simple, but the long term effects are horrific.

The best debt-reduction move is to ask for help. Most lenders will work with you if you call them. Unlike a fine wine, problems don't get better with age. As always, we are there to help. Call or email us with questions.