Getting Out Of Debt

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Getting Out Of Debt - An Introduction

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I once read that getting out of debt is simple but not easy and that is a very powerful truth.

At you will learn that “Debt is an Attitude” and the key to living a debt free life is about changing your attitude towards money.

Once we have made a commitment to change our attitude towards money we need to establish where we stand and we’ll explore this further in Debt Proof Living. We have to be prepared to establish how much debt we actually have; Whether it is good or bad debt and what percentage of our income is absorbed in debt payments each month.

We then have to learn how to prepare a personal budget worksheet and identify ways we can manage our money that are most suited to us.

From here we draw up a debt management plan which we follow each day, month and year until our personal debt mountain is conquered.

If you have tried the above before and failed don’t beat yourself as there are millions of others just like you. However, don’t do what most of them do and give up trying to become debt free. You may have read that the definition of insanity is to keep doing the same things over and over again and expecting a different result. If what you have tried hasn’t worked for you then try something else until you discover a method that works for you.

If you have been unsuccessful in your attempts to manage your debt don’t be afraid to investigate debt clearing solutions ask for help. There is plenty available some for free and some at a cost. If you cannot get started or work the plan on your own then get help. Debt is too big a problem to live with forever and I promise you the quality of your life will improve immeasurably if you get debt beat once and for all.

This site will provide links to businesses and tools that will view your situation sympathetically and help you tame the debt monster. Where possible these will be free but sometimes paying a fee is really the best option.

We also provide a Debt Solution Center that will teach you what you need to know from understanding free instant credit reports to different types of bankruptcy.

At the end of each page you will find a list of resources which contain links to additional products and services that can help improve your credit score, get you out of debt more quickly and remove some of the stress of acting on your own behalf.

Please take advantage of them, especially if you prefer to avoid playing hardball. You need a pretty thick skin when negotiating on debts. Handing the reigns to a third party takes a major hassle away from you and can immediately improve the quality of your life.

New content will be added to the site as and when there is something important to say that can help you to reduce and ultimately eliminate your debt.

I hope you find this a valuable resource.



Changing Your Attitude Towards Money

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Money Is For Managing Not For Spending

I used to believe that if I had more money everything would be fine. One day I received a $30,000 pay rise which sounds a lot but didn’t actually go that far. That money became a new BMW, a bigger house and a couple of trips away. In fact by financing the BMW I actually picked up more debt which was to prove a problem when 18 months later the company I worked at went bust.

The truth is not so much how much money you make but what you do with it and how you manage it. The truth is that contrary to popular belief money is for managing not for spending and that requires a major shift in attitude.

I became dependent on my spouses income and our combined incomes were $130,000 per annum less than before. For the majority of people this could easily have been a major problem but to our credit we had never really borrowed much money and we managed to downsize our life. It’s been a struggle but our only debt remains a mortgage of $160,000 of which we will pay a chunk off in 2009.

If we hadn’t had the right attitude towards money and kept on spending as many Americans do when they have an unfortunate change in circumstances we would have drowned under a deluge of debt.

In order to change you attitude towards debt you first have to change your attitude towards your earnings and then towards your households expenses. There are two schools of thought to this the first being that you should only spend 90% of what you earn and put the remaining 10% in a contingency fund. The second says only spend 80% of what you earn, put 10% in a contingency fund and give 10% away. The belief behind giving money away plays to the law of attraction in that what you give away on a regular basis will come back many times over in return.

I’ll leave you to decide which route to choose but choose one of these routes you must. You must change your attitude towards money to recognise that it must be managed before it is spent.

We’ll explore this further in the next section Debt Proof Planning.

Getting Out of Debt