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Is Debt Consolodation The Right Thing To Do?

Apr 10, 2008
Not only are people with high levels of debt miserable but they will also often ignore the problem in the hope it will go away; certain options exist but you must first take some control of the money that is being spent. If you are in this situation then you need to sort out some form of debt relief immediately. To avoid the situation worsening it is important to manage your money carefully and eliminate debt as early as you can.

Do not let panic over the situation rule your actions as you will probably end up in a worse predicament. It is often the case where a loan is taken out but circumstances change and it becomes a burden but you need to continue the repayments.

Create a budget for yourself by adding up all your income, payments and expenses which will help you check where your money is being spent plus your budget will highlight all the small, unnecessary expenses that can be eliminated. Cut your credit card usage, then start paying for goods in cash again and the psychological act of seeing the money physically leave your hands will make you more careful how you spend it.

Any spare money can then be placed in a special fund to help with your debt relief payments and although it will take some time for a reasonable amount to accumulate, you will see the benefits in time. By reducing the amount of entertainment you have on a regular basis will allow even more money to go into your fund and your debts will disappear faster.

No-one really wants to increase their mortgage repayments but many homeowners see their only option is to refinance their home which can work but just increases the amount you pay in the long term. Although this is a great way to raise spare cash in the short term you may not think that way a few years later so consider if this is really right for you.

One method of reducing the amount of cash paid out monthly, albeit a short term one, is to use cash out on your credit card to pay for the monthly installment. Whilst bankruptcy seems to be the only answer there are serious elements to take into account and you would be wise to consult with a specialist bankruptcy attorney first.

Although it can be done, bankruptcy can be avoided by using the savings you have in your individual retirement account is the last method you should ever consider to pay off your debts. This is not an ideal resolution as long term retirement benefits are at risk so use this debt relief solution knowing the consequences in advance.
About the Author
Anthony Dean has helped thousand get in control of their debt. See what he can do you for you here.
http://www.yourdebtapply.com
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