Automate Your Way to Debt Freedom

BY DEBBIE DRAGON

Total U.S. consumer debt reached a record $2.75 trillion in 2012, according to the Federal Reserve. Since your motivational level is high with the new year, why not take the time to tackle your debt? Choose to be one less person that contributes to the nation’s alarming consumer debt statistics.

The trick to successful debt relief is to find the method that makes the most sense for you. Not every debt relief idea is suitable for everyone and there is no one-size-fits-all solution. Your bank account may be the tool to help automate your way out of debt. There are several key steps that will be necessary for effective debt relief. Here is an overview of where you may need to start:

Sort the numbers

You need to know where you stand financially. If you are just guessing how much debt you have rather than knowing exactly what you owe, you can be in bigger trouble than you know. Take time to sit with all of your creditor’s statements, bank statements, paystubs, and other income information. You’ll need to confirm how much money you are bringing in and how much will need to go out each month for your basic living needs. Make a list of your creditors, their balance due, the interest rates, and the terms for repayment. Notate any past due debts that are affect your credit.

Consider personal financial management tools to help keep a tab on your finances.

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