By Alyice Edrich
Americans are filing for bankruptcy at an alarming rate. Spending is out of control. Arguments over finances are destroying families. Financial stresses are among the top five reasons couples divorce.
Debt Under Construction:
Debt has a way of creeping up on us. In time, it begins to take on a life of it's own, causing deaths of families. But it doesn't have to be this way. Debt can be controlled and marriages can be saved. People don't have to live paycheck to paycheck.
People don't have to spend their lives working to pay off past debts. We can stop looking back. But it's going to take work. The following are ways to help each of us get out of debt:
1. Take the time to understand why you spend, when you do. What is the underlying issue? Did you come from a poor family? Were you never taught money management skills? Did you always get what you wanted, when you wanted it? Are you sad and lonely, and find spending money eases the pain? Is keeping up with others important to your self-image?
2. Get out all your bills. List them according to company name, interest rate, balance, monthly payment, and interest paid out each month.
3. Send the kids on a sleep over adventure with a neighbor or relative. Order take out, and sit down with your spouse to discuss a course of action; a way to get out from under all that debt. Don't argue over who spends more, or who made the debt. Don't place blame (it only puts up walls) because nothing will get resolved. Instead, think about solutions.
4. Decide how much "mad money" each person is going to get each month. Mad money is money that can be spent anyway the holder of that money wants. And the best part about it is that you don't have to feel guilty about it.
5. Decide which bills you are going to concentrate paying off first, and which ones you are only going to pay the minimum on. It's best to pay off the cards with the lower balance because it gets paid off faster, encouraging you to keep going.
6. Agree not to charge anything else on any of the credit cards, unless it's a dire emergency, until all cards have a zero balance.
7. Agree not to open up another charge account.
8. Decide whether consolidating these bills would be the best solution for your family. And if you decide yes, decide how much money you are willing to pay in fees, points, and interest rates. If yes, decide to cancel each and every credit card you currently possess. If you don't you will only accumulate more debt on those cards.
9. Decide who is going to take over paying the bills, or is it going to be a team effort?
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