A debt elimination system will help you a great deal if you stick with the system.
There have been many debt elimination systems coming forward over the years, but this debt elimination system is simple and proven to work. This system has a series of simple steps for you to follow, and if you choose to follow them, you will soon be free of those chains.
Here are the steps to this Debt Elimination System:
1. Gather records of your total expenses over the past year. The reason for going over an entire year is to account for the differences in seasonal spending. Gather canceled checks, credit card statements, bank statements, and any other expense records. You need these records to start your debt elimination system.
2. For the next couple of weeks, keep a record of all your expenses, including the stop for a soda, or cup of coffee. This will be a pain in the butt, but will be worth it.
3. Add all your expenses then divide them by 12, giving you a monthly average.
4. Get the current balances for each debt, including your mortgage. You may need to call your creditors to get a payoff amount.
5. Add up the monthly minimum payments, creating a total for each month needed to go toward your debt.
6. Make a list of your minimum payments for the month.
7. Next, take the balance and divide it by the minimum monthly payment. You will then have the number of months needed to pay it off.
8. Now you are going to rank your debts from the smallest to the largest. You are going to take the one that is going to take the least amount of time to pay off as your first priority, the lowest priority will be more than likely your mortgage, the largest debt. This will get your debt elimination system started in the right direction.
9. In step 5 you totaled up the monthly payments on all your debt. You are going to take 10% of this total and redirect this amount to paying off your debt. There will be many who will say they can’t come up with 10%, but you can. This is where you cut your personal spending and make a few sacrifices to fund your debt elimination system.
10. Take this money, the 10% and apply it to your smallest debt. You will see this debt disappear quickly and help motivate you to keep going. Once that debt is paid, you will take the 10% you were paying toward that one and putting another 10% toward the next one. Each time you apply this percentage to your debt elimination system you are that much closer.
As you can see, the amount of money to pay towards your debt elimination system grows, allowing you to pay each one off faster than before. In just a matter of a few years you will be totally debt free, where the way you were heading before was a long road of higher and higher debt. Once all your debts are paid, you will have that money to start investing and making money. This is a debt elimination system