Let’s face it; being in debt is a stressful situation. It’s something that can prey on your mind day and night, and having more stress in your life is something you should avoid: it makes your life less than it can be. Stress can also cause medical problems that you may not experience with a less stressful life.
So, how much debt is considered reasonable and what are some ways to help reduce your debt?
Almost everyone has some form of debt. Many people have mortgage payments or rent payments due every month. They have utility bills like electrical bills, heating bills and property taxes. They may have association fees if they live in a condo or co-op. People with children may have expensive dental bills for their children and themselves which may necessitate a monthly payment plan.
Car payments are another expense, and gas and maintenance for the car can really rack up the money owed by their owners. A reasonable amount of debt is debt that doesn’t cause you to miss payments for the necessities in life. Of course, most people will find themselves being late on a payment now and then, or missing that payment entirely. It happens to almost everyone. But, if the amount of your debt causes you to become late on your payments on a regular basis: you have too much debt and need to take steps to reduce your debt.
The first step to reducing your debt is to closely go over your monthly spending. Get in the habit of writing down the amount spent and what the purchase was, every time you take out your wallet or credit card.
You can divide a notepad into sections. In one section you can title it food. Every time you go to the supermarket enter the total there, do it right after shopping so you don’t forget. If you make a quick stop into a deli to buy a sandwich don’t forget to write it down, even if you purchase a candy bar, mark it down: this simple step may be enough to substantially get your debt under control. Some people have no idea how much a quick stop somewhere ends up costing them a huge amount over a span of a month, you may be amazed at the amount you spend on these little treats.
Another section in your notepad should be titled utilities. You should write down your monthly or bi-monthly electrical bills. Add your heating costs and water bills in this section. Also add any other costs that you pay on a monthly basis or on a seasonal basis, such as landscaping and pool maintenance costs. When you actually write these down it becomes much clearer where your money is going. You may be amazed at just how much you are actually spending.
Don’t be surprised if you are shocked at how many things you can save money on, and be able to bring your debt down to a manageable level. Even if you don’t have a pool or landscaping done on your home, and you live in a small, modest home, you should still keep a journal of the costs you do have. The chances are good you will see some ways to make a big difference in your overall debt.
These ways are some basic simple ways to effectively get your debt reduced.