05 November 2012

Credit Card Debt Payoff: How I Shed $30,000 in 20 Months

Guest post by Celina Jones* 


Being in debt in this highly inflated economy is not something unexpected. The increase in the prices of the commodities may not match the increase in income, which obviously will lead to greater amount of money being spent on the same necessities that individuals purchase routinely.

However, individuals may also fall prey to debt if they do not plan their expenditures wisely and are not cautious of their financial situation. It would be wise for an individual to deal with their debts as they arrive and not wait until they get accumulated to a massive amount.

If you have debt problems a good first step can be to talk to debt companies. They will help you in avoiding bankruptcy and regain your credit. If you don’t wish to use external services, you may wish to use the tips I used to shed $30,000 in 20 months.

One thing that I want to make clear is that having such a huge debt was not a matter of a few days or a month, it accumulated over time. I used to provide counseling advice to people who were not able to pay their mortgage payments on time. At the same time, I was worried about my own financial situation and the huge debt that I had to pay off.

I was always aware of the amount of debt I had, but did not take any aggressive actions to repay it, instead took passive steps occasionally to reduce the balances on my credit card. This did not help as much as was needed.

The first thing I did was to make use of the alternate sources of income. I have a house in some other city and had rented it out. I used to pay off a certain portion of my debt with the rental amount I used to get every month which was not that significant.

As I was focusing on managing and paying off my debts on my own and the difficulties I had to face, I suggest that if you have debt problems a good first step can be to talk to Consolidated Credit. This is because getting help at times of crisis reduces a lot of burden and stress, as you will have a specific plan jot down and will not have to keep looking for ways or alternatives you can adopt to handle so much debt on your own.

One advantage I had was that I used to share an apartment. This benefited me as I didn’t have to pay all the bills by myself. Instead, all the bills were equally divided amongst me and one more person who used to live with me. This way, I was able to use up the money I saved from the payment of bills to settle some of my debts.

Since I used to pay all my bills on time, this helped me in getting a good credit score. This further helped me to negotiate with my credit card suppliers to relax some of the time limits imposed so that I was able to pay the entire amount of debt without having to incur any further debts in an attempt to do so. This is one reason why I was able to pay off $30,000 debt without taking any stress, but it took me around 20 months to do so.

Over time, I managed to cut off on unnecessary expenses and plan my expenditure economically so that I did not end up over-spending. I allotted my total monthly income wisely between the expenditure on necessities and the repayment of debt. Although, the terms were relaxed, I was still required to pay a certain amount every month.

As a last resort, I chose to use only some of the funds from my insurance policies. Now that the debt is settled and I have come out of such a stressful situation, I have decided to be careful with the money in hand and not to over-indulge in un-necessary expenditures in order to secure my present as well as the future!

Paying off a huge debt does not happen within hours or days. A lot of factors need to be taken into consideration when attempting to use money for paying off debts. You cannot just simply use up all your savings for that as you cannot be sure of the future. You need to make a smart move and use some and save some in order to be able to cope with any future unforeseen circumstances.


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* Celina Jones is a debt adviser that has ample knowledge on various debt settlement issues and has gone through some debt problems herself. She likes to share her knowledge and experience with those who are currently facing debt problems so that she can help them out of it. She suggests that if you have debt problems a good first step can be to talk to Consolidated Credit.

1 comment:

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