We’ve all been there at one time or another.  Some more often than others. But having a lot of debt is so detrimental to us, it is important that we find a way to get out and stay out.

When we are in debt, we are stressed. When we are stressed, our health suffers.  Unfortunately,  our debt can affect our ability to get the health care that we need. Which then causes us to be more stressed….

The first thing we need to do is to establish a b-b-b-budget.  Yes, that word is VERY hard to say. But it is so freeing when we actually do it.  First, make a list of all of your bills.  If they are annual, list them too, then divide the amount due by 12 to get a monthly amount to budget. List the amount due (or average amount due) for each one.  For credit cards and other loans, just list the minimum amount due for now.  List the due dates, and current balances. Arrange this list with the monthly bills – phone, electricity, etc. at the top. Then list the ones with a set balance from biggest to smallest balance due. Look at your spending habits and decide on a reasonable amount to budget for food, clothing, and other necessities.  Add up the amounts due to get a total outgoing for each month.

Now figure out how much money you have coming in every month. Remember to include all paychecks, average commissions, child support, whatever you get on a regular basis. If it’s not something you can depend on, for now I would not list it, but put it in savings when it does come.

Hopefully, the total income is more than the total due for each month.   The plan to get out of debt is this.  Pay the minimum amount due for every bill each month, except for the one with the smallest balance.  Pay as much extra as you can afford on that one, until you get it paid off.  Now take whatever you were paying towards that smaller bill, and apply it towards the balance of the next smaller bill.  Before long, that one will also be paid off.  Before you know it, you are out of debt! Now doesn’t that feel good!