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reduce debtMost people have some form of debt whether they have student loans, credit card balances or a car loan. While there is nothing wrong with having some debt, the goal should be to never owe more than you can afford to repay in a timely manner. If you feel like you have overextended yourself, how can you reduce debt and keep more of your money?

Take a Careful Look at Your Expenses

There is a good chance that you spend money on things that you don’t really need or for which there are less expensive alternatives. For example, you could replace your current cable bundle with products like Netflix or Hulu. Instead of paying $100 a month, you can pay $10 a month for most of the channels or shows that you get now. Simply going through your current budget could reveal ways to save money without having to drastically alter your lifestyle. Take one month and make a chart of every dollar your spend and see which categories are the most expensive. Once you see how your money is being spent each month, you can look into alternatives or even cancelling some of the services in order to save money.

Look Into Debt Consolidation

If you have a high interest credit card, it may be a good idea to look into a balance transfer to a no interest credit card. Simply lowering your interest rate could save you hundreds or thousands of dollars per month. Other ideas to consolidate debt and lower your interest rate include taking out a loan or a home equity line of credit if you own a home and have sufficient equity in it. The best option for most people is to contact a company that specializes in debt consolidation for help. While opening a new credit card may seem like a great option, you run the risk of harming your credit score, especially if you don’t get approved for the new card and/or balance transfer.

Bankruptcy Could Be an Option

Although this should be the last resort, you may be able to find debt relief through bankruptcy. Chapter 13 bankruptcy allows you to keep some or all of your property while you make payments to creditors. This can also be used as a means to gain extra time to work with secured lenders to renegotiate an auto loan or a mortgage. Chapter 7 bankruptcy allows individuals to liquidate their property and use that money to pay off as much of their debt as possible. For those with limited assets and income, they may pay little or nothing to have their debt discharged. Bankruptcy is not an option for everyone. Before you make a decision to file for bankruptcy, it’s important that you consult with a financial expert.

Debt Settlement May be the Best Option for You to Reduce Debt

If you are looking to reduce debt, debt settlement could allow you to do so without having to give up your property. Debt settlement may also be preferable to bankruptcy from a credit perspective. While you can ask for a settlement on your own, you may be better off working with professionals who will negotiate on your behalf to either lower your interest rate or forgive part of your debt. In some cases, you may get a lower interest rate and have a portion of your debt forgiven. Eligible debts include credit cards, medical bills and personal loans.

Those are looking for effective and timely debt relief, you have many options at your disposal. If you are interested in debt settlement or consolidation, contact us today to learn more about our services and how such a tactic can help you get your finances back in order.

Christian Debt Counselors (888) 906-3328
200 W. Palmetto Park Road Suite 200 Boca Raton FL 33432