Do-It-Yourself Debt Reduction and Relief

If you need debt relief, reduction or even credit card debt consolidation, try these following techniques first. Think of these as personal debt reduction and relief actions.

Preparation

1) Sum up all your credit card and loan statements.

2) Compute how much of your take home pay is spent on debt excluding your mortgage payments.

Figuring it all out

The key here is how your income is cut into pieces. Your mortgage payment shouldn’t take more than 30% of your gross income, and your other debts should only take 20% at most. That will leave you with at least 50% of your income for savings and other expenses.

Also, you shouldn’t be paying only the minimum (or paying below it) for your monthly debt payments

Budget

Now that you have working figures, put your attention on your monthly budget. Trim all the non-essential expenses, so that you can focus on paying your debt. Write down all purchases, and keep ATM and credit card receipts.

Essential expenses include mortgage or rent, food and utilities. All other expenses can be trimmed down, so you can devote more resources to your debts. Even then, you can minimize on your groceries by shopping with a prepared list at cheaper stores. You can also practice energy conservation tips to lower electrical and water utility bills.

Payments

At this point, you should be ready to implement your personal credit card debt consolidation or debt reduction and relief techniques.

1) Pay off high-interest debts first. Even if you have to scrimp for two months or so, pay it off in as little time as possible. That way, the effect of the high interest rate is minimized.

2) In terms of credit card consolidation, try to transfer all your credit card debts into your card with the lowest interest rates. If the low interest rate only works for an introductory period, then pay off as much as possible in that time.

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