How to Keep Control of Your Debt

The temptation can sometimes be overbearing - everyone is offering you "free" credit cards and hire-purchase debt and you really want to buy that new computer so why not just go ahead and do it? The simple answer is you need to keep control of your debt or risk having a bad credit rating!

Obviously the best method to keep control of your debt is not to spend more than you earn! However, that can be difficult as sometimes life throws us challenges we have not prepared for, like the broken water pipe last winter, which means we have to spend more than we thought.

If you're currently having problems with the level of your debt, here are 5 ways you can try and keep control of your debt:

- make a list of all your earnings and expenses. See whether or not you earn more than you need to spend each month. If you do, start a budget to repay your debt. If you have more debt payments than earnings each month, you'll need to start looking for part-time work until you have repaid your debt in full.

- breakdown your existing debt in a list. At the top put the debt which you are paying the highest interest and fees on. At the bottom put the debt which you are paying the least debt and fees on. Now you know which is costing you the most, make every effort to repay the debt at the top of the list, while still repaying the other debt, until this debt is repaid in full. Then work your way down the list until all your debt has been repaid.

- change all of your utility and telephone bills over to a budget plan. You are now taking control of your debt and unchecked spending is the vast track to uncontrollable debt!

- stop charging to your credit card. Just because you have made the monthly minimum repayment to your credit card company does not mean that you can go out and charge that money to your credit card again this month. That's the road to financial ruin - you'll never repay the credit card debt, at the same time you will be giving away lots of your hard earned money in interest payments each month.

- save! Not enough of us have adequate savings plans and this will cause us problems later in life. While it is good to make a certain standard of living today, you should not do this at the cost of your standard of living in the future. If you want to make sure you have control over your debt, you not only need to control any debt you have today, but also any debt that you may need to have tomorrow.

Knowing how to control your debt is not difficult; keeping control of you debt is. Always remember though, if you live within your means then you should be able to comfortably control your debt.

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