5 steps to success in defeating debt

Beating debts is as much as what is in your head as well as what happens in your wallet. If you have a debt problem, you can solve it if you admit this. Here are five steps you can take to start beating your debt:

1. Take control
There are times when you have to admit that your debt beats you. You cannot participate in repayment; interest costs increase and, maybe even worse, you use one loan to pay off another.

You have to control your finances: if not, your creditors will do it. If you deny this, you need to face the truth. If you can face the truth and take control, you are in the first step to beating debt.

2. Live according to your ability
Look at your credit card statements and card bills. What did you spend the money for?

Surround your house and pay close attention to the items you buy with the credit card. Are they worth it? Do you really want them? What difference do they really make in your life?

What do you feel when you look at those things and say to yourself, ‘I haven’t paid for it (xxx) yet’?

3. Reduce your stress
Debt can be a nightmare and stress can make you despair. It doesn’t have to be like that. There is a way out, but it is not an easy way out. You must control yourself and your expenses, and be determined to get your life back. When (and only when) you get that mental determination, then consider consolidating your debt.

4. Eliminate your debt
Consolidating your debt is a one-chance option to pay your debt. Debt is not lost, but all the various loans and debts are put together into one larger loan to be repaid in a longer period and at a lower interest rate. This frees up part of your income and will instantly reduce your stress.

And, most of all, you don’t have to keep piling up credit card debt. You will only get rid of debt if you live within your means.

Try an experiment. Leave your credit card at home for a week and live on cash. Pay everything with money – yes, everything. This will help you handle your budgetary needs. When you see money sneaking through your fingers, it will bring home the fact that your money supply is limited.

At the end of the week, ask yourself how you feel. If it’s difficult but you manage to prioritize your expenses, congratulations – you’re in control! If it’s difficult, or impossible, then try again. You have to be tough with yourself to control your money.

5. Get your life back
Happiness can’t buy useless luxuries: it’s about being free. Cut all but one of your credit cards, and pay back the credit card every month, without fail. You will enjoy things that can only be bought with money if you spend the money you have – not the money you borrow. Resist the temptation to pamper yourself with money that does not belong to you.

Money has the power to enslave you and also set you free. When your debt is out of control, you are enslaved. You can become free only if you take control.