You have a debt problem. No matter what you do it seems you always seem to fall behind on bills and you never seem to make a dent in paying off your debts. The first step, as you have heard a thousand times, is realizing that you have a problem. You’ve done that. Now what?
It is important to find the source of your debt. What is it that got you into trouble in the first place? Identifying the underlying problem can help you recover from debt. Plus, simply knowing the areas of money management you need help with will go a long way towards improving your finances in the future.
First, take a look at the debts you have. Do they come from one or two major purchases such as a home or a car? Or do you debts stem from many small purchases? The root of your debt can indicate the type of behavior or need that you debt comes from. For example, one or two major purchases putting you far into debt may mean that you live beyond your means. Think about it, is that extra bathroom really that important? Are you just driving that car to impress people? No one will be impressed if you loose everything because of debt. This is where debt relief can really help.
What if you have minor purchases that seem to get out of hand? Simple shopping tips and basic financial planning can curb your spending habits. Try making a list before you go shopping and stick to it. Don’t buy items you don’t need. Staying in control of spending habits means setting strict rules for yourself and being more selective in what you purchase.
Make a list of all of your debts. Get out your credit card statements from the last year and make every purchase into a list of “necessities” and “not necessities”. Be honest with yourself. That new shirt for the office Christmas party is not a necessity. Medical bills are a necessity. Then, take your non-necessity list and divide into categories such as food, entertainment, travel, etc. See what you are spending your money on and be aware when you go shopping. Make notes of your spending habits and cut back in the areas where you overspend.
The next step is learning basic financial skills in order to track and understand your financial situation. As well, it would be worth finding out your credit score and getting credit repair if necessary.