How to Get Out of Debt

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The only way to begin getting out of debt is to quit acquiring new debt.
Establishing an emergency fund is also helpful, as well as implementing a
debt snowfall, and in some cases, consolidating your debt may be useful.
Let's look at each of these from an in-depth point of view.

The only way debt becomes out of control is when people keep adding to it.
Any person who is under financial hardship due to debt should never use
credit cards. In fact, they should cut up their credit cards. There is no
rationalization that a person in debt should need a credit card.

Credit cards are simply a trap, as they only put a person in debt deeper.
Only when a person is completely out of debt should they consider
(maybe) obtaining a credit card. Recurring payments are just about as bad as credit cards.
They should be halted along with cutting up credit cards.
A prime example of money wasted on recurring payments is a gym membership.
No matter what kind of line of credit is being used it should be stopped.

Once a person cuts up their credit cards they should then call their credit card companies.
All credit cards with a zero balance should be canceled. Credit card accounts
that stay open should have their terms and rates renegotiated with the
credit card lender. Many credit card companies will agree to lower rates when
a credit card holder provides them with the rates of other companies.

Just remember it never hurts to try and negotiate. If this fails, consider
seeking out a debt help service. They oftentimes have pre-arranged
rates negotiated with creditors.

Establishing an emergency fund is often a key to getting out of debt that baffles debtors.
They wonder why they should save money when they could apply that money to their debt.
However, it is imperative to keep in mind that no matter who you are unexpected expenses do occur.
A minimal amount of $1,000 should always be set aside in an emergency fund. And most
importantly a person should remember that this money is for emergencies only. It is not a
Christmas fund or wish-list fund, it is for emergencies.
In fact, this money should not be immediately accessible but it should be kept liquid.
Emergency funds should never be tied to a debit card because it becomes too easy to tap
into the funds. The debt snowball strategy is a wonderful way to pay off debts.
You simply make minimum payments on all your debts until your lowest debt is paid.
Then you take the amount that was being applied to it and put it towards your next lowest debt.
Positive results can be seen immediately.

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