2 examples of eliminating debt to try in the new year

2 Examples of Eliminating Consumer Debt

           

 According to Debt.org, on average, each American household with a credit card carries $8,398 in credit card debt, and each credit card holder has at least 4 credit cards in their names. Some might wonder what can be done about this. There are many ways we can stop debt and even eliminate Consumer Debt. Eliminating consumer debt in two different ways: The snowball method and maintaining a budget can help you have financial security and help you become free from consumer debt for good.

 

            One of the most effective ways to eliminate debt is mentioned by family and consumer advisor In the Ensign Article from July 2011 Getting Out of Debt—for Good By Luke V. Erickson “Arrange your debts from smallest to largest. Make the minimum payment on all debts each month except for the smallest one: on that one, pay as much as you can. Once it is paid off, roll the regular payment you had been paying on that debt to the next-largest debt until it is paid off. Continue the process until the payment “snowball” has grown so large it quickly knocks out debts that stand in its way.”  This example is one of the best ways and trusted ways to start eliminating debt. From personal experience, using the snowball effect to get rid of debt has helped us pay off our car and student loans faster and live without carrying consumer debt.   

 

            A great way to be mindful of where your money is going is to start and maintain a budget. The extra money that you have at the end of the week or month goes back into the debt that you have acquired. When we are able to manage our finances, including budgeting, we are able to enjoy financial freedom. Budgeting is key for financial freedom. Remember the key to eliminating consumer debt is working within the money we take home or living within our means. Lane V. Erickson’s a Bankruptcy Attorney wrote “Simply put, budgeting means tracking purchases and expenses and creating a written plan to save a certain amount of money each month. But why should we budget? Many people think a budget robs them of their freedom.” I like what   President Tanner wrote on financial freedom, “On the contrary, successful people have learned that a budget makes real economic freedom possible.” Budgeting provides economic freedom because it allows us to control our money rather than allowing our money to control us.” Knowing that budgeting is a way of life to eliminate debt helps us to have the financial freedom we deserve.

 

There is a wonderful feeling when you pay off that debt! Having to budget is never easy- or fun. However, I have found that when we are cautious about our spending, we might not always get what we want, but we get what we need. To stop consumer debt, having this thought in my mind has helped me stay away from debt. Using the snowball method and budgeting has helped my family and I to be wise stewards of our money, and resources and to eliminate debt.